Why Sanitised Stories Weaken Investor Confidence
“All that glitters is not gold,” the catchphrase goes. For several years, the African tech stories all sounded like a repeated promise. Pitch decks reading like best-selling adventure novels had rapid growth, continent-wide scale, and impact neatly folded into unit economics.
Between 2018 and 2022, venture capitalists invested billions into the African tech ecosystem. Startups such as Piggyvest, Flutterwave, Wasoko, Moove, MNT-Halan, and Instadeep received some of the largest cheques ever issued to Africa’s startups. At the rush’s peak in 2022, startups raised $3.3 billion across 633 deals, up from 564 the previous year to mark a 12.2% increase in the number of funded companies.
Builders learned to speak fluently, the language investors were used to hearing, a eulogy of scale, certainty, and an outlook that read as investable. But the culture that defined this did not emerge overnight. The heyday between 2018 and 2021 taught a confident narrative that could unlock capital, partners, and talent. In cases where reliable third-party metrics were scarce, a neat story sometimes took the place of proof.
That sheen was rarely malicious. For many founders, it was the only way down an unfamiliar road. But with time, it became the elephant in the room, in an ecosystem where there wasn’t much data to prove otherwise. They often kept performance metrics under wraps, mindful of regulatory uncertainty, reputational risk, and the unevenness of local media coverage.
Genuinely, transparency can be risky. Disclosing operational hiccups or legal concerns could invite scrutiny rather than avoiding it. Because of the risk, updates are phrased carefully to protect themselves, even when the full story is more complicated. Oftentimes, the worry is that candid accounts of delays, layoffs, or regulatory friction would repel investors.
Yet the opposite is usually the case. Rehearsed optimism flattens nuance, and when every announcement sounds alike, investors attuned to risk begin to suspect otherwise. Uniform messaging erodes the ecosystem's individuality. Without unique, honest details, one startup pitch can feel identical to another's without the numbers that actually set them apart.
On paper, the “buzzwords” can be identical, but the underlying metrics, the number of users served, transaction volumes, geographic reach, and strategic integrations, tell very different stories. Investors buy into measurable inputs they can model, not the narratives used to dress them up, so when the ledger fails to align, that theatre of display turns into one of doubt.
The shift in investors’ mood
Getting to the meat of the matter and drilling down into details is always desirable, though not always possible or accessible, in the present coverage of African tech, says Henry Nzekwe, a journalist at WeeTracker, noting that overly cautious, doctored approaches risk erecting “echo chambers” and diluting discourse into bubble chatter that deviates from the real picture.
“But I must point out that industry players are becoming more comfortable dissecting matters in excruciating detail, even in messy situations, compared to five or six years ago, when coyness was the norm except among a few diaspora-linked or expat founders”.
This shift in norms creates space for more precise, data-driven scrutiny of startup claims, which, in turn, sees founders align their narratives with measurable performance.
The funding winter has crystallised these dynamics. Global risk appetite shrank, interest rates rose, and funds tightened mandates. Funding contracted sharply, and in 2024, venture capital funding in Africa settled at about $3.2 billion, down from the boom years.
High-profile ventures that frontlined the frenzy found it harder to raise follow-on capital, and some went quiet. Investors adapted, evolving due diligence from cursory checks to what some describe as “reality audits,” verifying media claims against ledger entries, speaking with ex-employees, and checking compliance filings. They began reading between the lines, seeking the real stories rather than relying on recycled narratives.
According to Victoria Crandall, Founder and CEO of No Filter PR, most startups have their basic messaging, vision, mission, point of differentiation, etc., for speaking with investors.
“That goes into their deck, and then it’s done. Communications in the ecosystem are still largely reactive. CEOs only update their messaging when dragged into a crisis, such as negative press over layoffs or mismanagement of funds. PR is often seen as nice-to-have rather than a strategic tool.”
Victoria adds that investors want ambition, but backed by evidence: “Saying you’re the leading company isn’t enough. They want receipts, revenue, growth, and hard numbers. You don’t have to sacrifice your big vision, but you have to back it up.”
Transparency can strengthen rather than weaken. Francis Osifo, CEO of Rayda, offers a case study. His software platform initially helped Nigerian companies track IT and lab equipment. When the naira crashed in January 2024, he pivoted to serve US and European companies. Later, he transformed Rayda into an AI assistant for IT departments managing workflows.
Being open about how close it came to shutting down makes a better impression, as it shows investors the business is tested, resilient, and capable of making hard decisions to keep going. A disclosure of tough decisions, pivots, and strategic remediation signals demonstrates the capacity to navigate shocks.
Yet the reluctance to disclose is not misplaced. Many founders operate in an environment where a misinterpreted metric can trigger regulatory attention, alarm customers, or be magnified by media reporting that lacks context. Reputational risk can outweigh the value of transparency when coverage does not reflect their interests. The tension that breeds can quickly turn into a broader judgment way before facts are settled. In such conditions, caution is a defensive instinct.
A different playbook
Lessons can be drawn from elsewhere. In India, the leadership of Swiggy, one of the country’s largest food delivery and on-demand logistics platforms, publicly accounted for layoffs and cost-cutting. The scale of the shock is documented, with thousands of roles cut across the sector in 2022–23. The publicity around those reductions saw leaders explain not just what happened, but why, and how they planned to recover. That practice made struggles legible and, crucially, allowed investors to model the downside rather than react to press props.
In Latin America, founders have treated frank updates as a governance tool. Brian Requarth, co-founder of Latitud, a global accelerator supporting early-stage startups, set an example by issuing a candid post and a firm-level reflection that became a template of sorts for transparent investor relations. The media framed 2022 as a corrective season and encouraged founders to publish sober assessments to help restore trust and align expectations. This practice can channel capital back into ventures with demonstrable remediation plans.
Public disclosure transforms vague fears, such as “we might be worse than we seem,” into measurable hypotheses. It allows investors to calibrate milestone-based financing or covenanted rounds. In the domino effect, transparency becomes insurable, actionable data.
The path forward for African founders is not to abandon storytelling, but to wield it with greater skill. Retention should be reported by cohort, gross margin trends disclosed, and burn and runway published alongside any celebratory announcement. Where possible, third-party attestations should be attached to auditable analytics.
PR professionals and journalists play complementary roles. Crandall emphasises that both aim for credible coverage that builds trust. “PR teams educate clients to provide unique industry insights, data, and founder commentary, while media partners understand the realities of working with busy founders and provide space to tell the story properly,” she says.
Different cases show the thin line between effective messaging and risky silence. Paystack’s transparent announcement of its acquisition by Stripe reassured investors and reinforced trust in the ecosystem. By contrast, Flutterwave’s silence following allegations against its CEO left questions unanswered. Even market-leading companies can unsettle investors when communication falters.
Publish auditable performance metrics alongside announcements, normalise quarterly letters that detail both successes and gaps, and embed disclosure-readiness as a milestone for accelerators and incubators. Investors should model outcomes rather than assume, and when metrics and assumptions are explicit, conversations shift to modelling. Giving investors tools to assess risk and remediation turns transparency into a competitive advantage.
The 2024 VC numbers reflected resilience but also a new geometry: fewer leaps and more attention to how every dollar is deployed. Active investor participation shifted after the correction. The question for founders is simple: do you want to sell a dream or build a durable business?
The caution that once protected startups is now a cost. Investors, burned by oversold stories, prefer truth to showmanship. As the adage goes, “Better to be a small truth than a large lie.” For African tech, this means replacing picture-perfect panegyrics with reconciled, verifiable information. Founders who embrace this discipline will lead the next funding wave.