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Africa’s Venture Capital Salary Insights

4 Mins read

Africa’s Venture Capital Salary Insights

In Africa, venture capital is fast becoming a sought-after career path, however, there is limited information on one of the most important factors of job decision making: a fair salary. While upskilling as a VC fellow at Dream VC over the last few months, I set out to understand the salaries of African analysts and associates working in Africa focused funds based in and out of the continent through a survey.

By the end of the research, I received 52 responses and ran some analysis to help an aspiring VC make more informed decisions in their venture capital career! In carrying out the multi-regression model, results showed that out of all the variables collected, the top 3 determinants of salaries were:

  • If you are an Associate or Analyst
  • Fund assets under management (AUM)
  • Headquartered in an African or Non-African country

In conducting this research, we wanted to test a few basic assumptions, and to see if any additional insights would be found! Our hypotheses included:

  • Associate Pay Is Always Higher Than Analyst Pay
  • Larger Fund AUM Means Higher Salaries For All
  • Non-African Funds Pay Higher Salaries Than Africa Based Funds

Following the analysis, here were the top insights gained from the results:

Insight 1: The Salary Bump from Analyst to Associate can be up to $1,758 increase month salary.

Based on the regression model of the data collected, it was found that if two firms were headquartered in the same place with similar AUM, an analyst would be making ~$1,758 less than an associate. Disclaimer: this regression was run on a small sample size of analysts and association. This number should not be taken exactly as it is but rather a way to prove that associates make more than analysts based on the data set provided.

What does this mean for you? You need to understand the growth path in the prospective VC companies you are looking at. If you want to increase your salary or desire a promotion, here are some questions to consider asking your boss or prospective employer: what are the opportunities for growth in this company? What does it take to become an associate? Is there a possibility for carry at this stage, or on promotion?

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Insight 2: Gender does not affect salaries in the continent

Based on the multi-regression model, it is determined that gender p-value was greater than 5% (much less than 95% confidence in the variable) meaning that it was not statistically significant enough to affect salaries. This analysis suggests that there is no gender bias in salaries in venture capital firms investing in Africa.

Insight 3: Non-African headquartered funds are likely to compensate up to $1,000 more per month than an African Based Fund Would.

It was interesting to discover that the average AUM of a non-African Headquartered, but African-focused, early stage VC firms was $25.94 million with $1,958 average junior (analyst & associate) pays, whereas African headquartered funds had an average AUM of $23.52 million (average salary midpoint is $1,918.48). These results align with the earlier hypothesis that “non-African funds pay higher salaries than Africa based funds”. See below table:

Insight 4: AUM is your best bet in finding a VC firm offering competitive salaries.

Based on the top three variables that most affect salary outcomes based on the data collected, there is a 97.5% confidence in how much fund AUM affects salaries (see multi regression results at the end of the article).

What does this mean for you? Consider doing in depth research for the funds that you are trying to work for. Typically, if their assets under management is low, you would be paid a lower amount and vice versa. Remember, simple fund economics state that management fees are usually 2–2.5% of the funds raised from limited partners. VCs can only pay salaries (as well as other expenses) from these annual management fees, meaning there is a cap on the potential salary that is directly influenced by the AUM.

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Insight 5: African VC firms are twice as likely to give you bonus and/or carry.

Out of 21 people who admitted they receive a bonus and/carry from their company, only 8 worked for non-African headquartered funds. It was also interesting to observe that higher salaries are weakly correlated with the geographical location of the employer and have more to do with where the fund is headquartered.

What does this mean for you? If you decide to work for an African headquartered early stage VC fund, you could potentially see an increase in your base salary in the form of a bonus at the end of the year. Our data shows a one-time bonus payment ranging from $500 — $8000, depending on years of experience. Also, if you have relevant experience and join a very young VC firm in the continent, even as an analyst or associate, you may be entitled to some carry on deals.

The Math Behind the Analysis

This survey was distributed to 200+ people through LinkedIn, via VC Analyst Group Chats and in VC Communities for African Investors. We asked for the following inputs:

  • Employee’s Role
  • Gender
  • Years at Firm (since ranges were provided, a mid-point was used for the analysis)
  • Analyst/Associate Geographical Location
  • Monthly Salary Range (since ranges were provided, a mid-point was used for the analysis)
  • Bonus & Carry Offering/Amount
  • Fund AUM (since ranges were provided, a mid-point was used for the analysis)
  • Fund Name (not disclosed)**
  • Fund Headquarters (grouped into Africa headquartered and non-Africa headquartered firms)
  • Women Led Fund

**Fund Names Were Not Disclosed In Summary Analysis and Personal Names Were Not Collected To Protect Privacy Of Participants

For the purpose of understanding what variables affect the salary of Africa Venture Capital salaries, I completed a multi-regression model based on 46 data points collected from analysts and associates working at Africa based or Africa focused funds. In carrying out the multi-regression model, results showed that out of all the variables collected, the top 3 variables that greatly affect salaries are:

  • If you are an Associate or Analyst
  • Fund Assets Under Management (AUM)
  • Headquartered in an African or Non-African Country
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Multiple Regression Analysis Results

A few disclaimers:

  • This is not supposed to be taken as career advice, just as insights drawn from VCs operating in the ecosystem and a guide on what you may expect to see when salary insights are made.
  • This information can only be used as a benchmark, not as a reference point for negotiations, because salaries in each firm take into account intangibles.
  • The salaries provided are on a monthly basis, not annually.
  • Exchange rates and inflation are not factored into the analysis.
  • And no, you may not have access to the raw data collected. It is confidential.


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