High-growth subsectors to watch in Africa’s booming entertainment industry

African entertainment has been experiencing a meteoric rise. In 2023, the creative industries caught the attention of institutional investors, who poured money into the industry. Afreximbank announced a $1 billion Film Finance Facility for 2024, and the NBA expanded its presence in South Africa and Kenya.

Ghana hosted the first Africa Cinema Summit. And Sony Ventures launched a $10 million fund to support early-stage entertainment startups. According to PwC, the African entertainment market is set to grow by 15% annually from 2020 to 2025, reaching $4.6 billion by 2025. This sector offers huge opportunities for innovation, creativity, and monetization. Here are some high-growth subsectors to watch in Africa’s booming entertainment industry.

Sports

Sports is a rapidly growing field with a broad range of opportunities. From Kenya being famous for its world record-breaking athletes, who have boosted the country’s reputation and tourism, to the Africa Cup of Nations tournament, the biggest football tournament on the continent which typically generates a lot of revenue for the host country, the participating teams, and over $35 million in revenue for CAF. Sports also have the potential to generate significant economic and social benefits for the continent, such as tourism, infrastructure, health, education, and cultural diversity.

According to a report by PwC, the sports market in Africa is expected to grow by 15% annually from 2020 to 2025, reaching $4.6 billion by 2025. Hence, last year, the world’s leading basketball league chose South Africa as the fourth location for the expanded 2024 season of its Basketball Africa League (BAL) due to the nation’s strong infrastructure. In Kenya, NBA Africa announced the establishment of a new subsidiary, which will support all of the league’s business and basketball development initiatives in the country. This love also fuels the sports betting market in Africa.

The sportswear market. This market in Africa is driven by the increasing popularity of sports among the young and urban population, the rising awareness of health and fitness, and the growing influence of sports celebrities and brands. Also, there is an increasing demand for live and on-demand sports content, the emergence of new and innovative technologies and platforms, and the expansion of sports rights and partnerships

iGaming

iGaming is one of the fastest-growing sectors in the continent, with a projected annual growth rate of 9.01% from 2022 to 2027. This subsector includes online casino games, sports betting, and lottery gaming. Nigeria is one of the leading markets for iGaming in Africa, with a population of over 200 million people, with more than 60% under the age of 25 passionate about sports and entertainment. This means that there is a huge and growing demand for online gaming services, especially sports betting, which is very popular among Nigerians who love football.

According to a 2015 publication on Football betting in Nigeria, most bets are placed in bet shops while an increasing number of customers are placing bets online. The online gaming market in Nigeria is estimated to be worth over $60 million and is expected to increase as more people access the internet and mobile devices.

Another aspect of gaming is esports, a subsector that covers console and PC gaming, as well as competitive gaming organized video game tournaments with professional players and teams. This subsector is one of the most lucrative and fastest-growing segments of the global gaming industry, which is projected to reach a revenue of $114 billion by 2026, with a CAGR of 7.6%. Video gaming and esports appeal to millennial and Gen Z consumers, who are the largest demographic in Nigeria and Africa, with a population of over 400 million and a median age of 19. These figures indicate that there is a lot of room for growth and expansion in the Nigerian gaming market.

Film

While the entire African entertainment landscape is ablaze with opportunity, the film stands out as a particularly bright spark. In recent years, African film has gained more visibility and recognition on the global stage, due to a demand for rich and diverse cinematic heritage. Films such as African films also benefit from the growth of digital platforms, such as Netflix, Amazon Prime, and Showmax, which offer more distribution channels and exposure for local content.

The industry offers huge opportunities for innovation, creativity, and monetization, as well as for social impact and cultural expression. Nigeria’s film industry, known as Nollywood, produces over 2,000 films per year with a loyal fan base across Africa and beyond. Nollywood alone is expected to generate over $800 million in revenue by 2025. Documentary is another subsector of the African film industry that has gained prominence and acclaim in recent years, with several filmmakers and producers exploring various topics and issues affecting the continent and its people.

Although, institutional investors are still very reluctant to invest in the movie theater business, which they perceive as a dying, capex-heavy industry, with the advent of global streaming platforms. In reality, it seems that cinema keeps refusing to die. Last year, Africa witnessed many box office records including the first ever Nollywood film to gross ₦1 billion in ticket sales, which it did in 20 days after its release. The continent boasts the world’s fastest-growing cinema market, projected to reach $1 billion by 2025.

According to Marie Lora-Mungai, an investor, strategic advisor, and entrepreneur specializing in the African creative industries and sports, two viable models are emerging for the African theater business. A high-end, rich entertainment proposal mixing cinema with other attractions for the entire family (restaurants, gaming arcades, beauty and wellness salons) in the same location. Secondly, affordable, low-cost community cinemas servicing the enormous peri-urban and rural audiences who have so far been unable to access this type of entertainment.

Live events

Live events such as concerts and festivals are a popular way for Africans to spend their leisure time. There is a growing demand for high-quality events that feature local and international artists. The market is driven by the increasing popularity of African music and cultures among young and urban consumers, who are willing to pay for premium experiences and entertainment. A good example is the emergence of the “Detty December” culture at year-end in Nigeria. This particular frenzy which started around 2019 has become an annual ritual attracting thousands of Nigerians from around the globe to make a return home every year not just to visit relatives and friends, but to participate in one of the world’s biggest national extravaganzas.

Live events also attract tourists and visitors, who contribute to the local economy and culture. For example, the Cape Town International Jazz Festival, which is held annually in South Africa, attracts at least 34,000 festival goers annually and generates over $100 million in economic impact. There is also an influx of partnerships between local and international brands, such as Coca-Cola, MTN, and Red Bull, to sponsor and support live events.

Animation

The African animation industry is still in its early stages, but it has the potential to be a major force in the global market. According to UNICEF, Africa’s child population will be 1 billion by 2055, making it the largest child population among all continents. This provides the continent with vast opportunities to produce children’s content. There is also growing demand for African-made animation that tells African stories, reflects African culture, and appeals to African audiences. The market is driven by the increasing popularity of animation among children and adults, the rising consumption of online and mobile content, and the growing awareness and appreciation of African culture and stories.

Africa has a large pool of talented and creative animators to cater to these needs. Thanks to a rise in entertainment technology companies like Anthill Studio which have produced several animated projects, such as Plaything, Malika, Frogeck, and Ratnik. Last year, Anthill Studio tapped into mainstream cinema animation with its ₦120 million ($157,420) movie, Mikolo. Animation in Africa also has the potential to expand to other industries and sectors, such as education, tourism, gaming, and advertising, as it can provide creative and effective solutions for communication, visualization, and entertainment. According to a report by IMARC Group, the African animation market size reached $13.3 Billion in 2023, and is expected to reach $ 17.8 Billion by 2032, exhibiting a growth rate of 7.78% during 2024-2032.

Source: venturesafrica.com

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Szarlot

I am a fan of casino games especially roulette and blackjack. After that I analyze current events in the gambling industry.

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Szarlot

I am a fan of casino games especially roulette and blackjack. After that I analyze current events in the gambling industry.