RANSPORT and logistics startups have overtaken fintech in attracting investment across Africa for the first time in several years, presenting Tanzania with an opportunity to position its emerging businesses to benefit from a changing investment landscape.
Startups in the sector raised $780 million in the first nine months of 2026, accounting for 36 per cent of total funding, ahead of fintech, which attracted $760 million, or 35 per cent, according to Africa: The Big Deal’s Q1–Q3 2026 analysis.
The shift represents a significant change in the continent’s investment priorities. During the corresponding period in 2025, transport and logistics accounted for just seven per cent of startup funding, highlighting the growing interest in businesses addressing challenges in the movement of people and goods.
Experts suggest, for Tanzania, the opportunity lies in developing startups that can respond to gaps in urban mobility, freight transportation, cargo handling, warehousing and last-mile delivery, while capitalising on the country’s position as a gateway to several landlocked economies.
The potential is supported by the expansion of Tanzania’s startup ecosystem. Finance Minister Ambassador Khamis Mussa Omar said cumulative startup financing reached $315.8 million between 2019 and 2025, while the number of active startups increased from 247 in 2020 to 1,037 in 2025.
With Tanzania’s startups projected to attract approximately $90 million in 2026, according to Africa: The Big Deal, the country’s cumulative startup financing could reach about $405.8 million since 2019.
However, the growing availability of capital does not automatically translate into investment for local businesses. Startups must demonstrate that they can identify market opportunities, develop commercially viable solutions and expand beyond the domestic market.
Jumanne Mtambalike, Sahara Ventures Chief Executive Officer, said Tanzania needed to strengthen the connections between entrepreneurs, investors and the wider business ecosystem to ensure local startups could compete for emerging opportunities.
“Investment opportunities are increasingly emerging in sectors beyond fintech, but Tanzania must ensure its startups are ready to compete for that capital.
“We need an ecosystem that connects entrepreneurs with investors, strengthens business models and enables promising companies to scale beyond the domestic market.
“The opportunity is not simply to attract more funding, but to build businesses capable of solving real problems and delivering sustainable returns,” he said.
According to Mtambalike, the importance of building businesses around identifiable market needs is particularly evident in logistics, where inefficiencies in transportation, distribution and cargo handling create opportunities for technology-driven solutions.
Dar es Salaam provides one of the clearest examples of the potential market. Rapid urbanisation, population growth and expanding commercial activities are increasing demand for more efficient transport and delivery services.
The 2022 Population and Housing Census recorded 5.38 million people in Dar es Salaam Region, making it Tanzania’s most populous region. The National Bureau of Statistics’ 2025 report on migration and urbanisation also identifies the city as fully urbanised, with more than 2.4 million lifetime in-migrants, adding pressure on land, housing and public services.
One of the consequences is growing congestion, which affects not only commuters but also businesses that depend on the timely movement of goods and services.
A joint study by Tanzania Investment and Consultant Group Ltd (TICGL) and the Tanzania Economic Research Institute (TERI), published in 2025 using data collected between 2023 and 2025, found that workers in different parts of Dar es Salaam lose between 2.48 and five hours daily in traffic congestion.
The study highlights the economic implications of prolonged journeys, including reduced working hours, delayed business operations, fewer transport trips and higher fuel consumption.
These inefficiencies provide a market for startups offering real-time traffic information, route optimisation, digital ride-hailing, fleet management and delivery services that can help businesses to reduce transportation costs and improve operational efficiency.
Janeth-Kareen Kilonzo, Plate AI co-founder said investors were increasingly interested in businesses capable of demonstrating how their solutions addressed specific market challenges and generated commercial value.
“For Tanzania to attract more investment into logistics and other emerging sectors, startups must demonstrate that their solutions address real market needs.
“Investors want to see businesses with clear revenue models, customers who are willing to pay and technology that delivers measurable value.
“Having an innovative idea is important, but the ability to turn it into a commercially viable and scalable business is what makes it attractive to investors,” she said.
She noted that while urban mobility offers one area of opportunity, Tanzania’s geographical position presents an even broader market through regional trade and cross-border cargo transportation.
The country shares borders with six neighbouring landlocked economies: Uganda, Rwanda, Burundi, Democratic Republic of the Congo (DRC), Zambia and Malawi. Its ports and transport networks provide access to markets across East, Central and Southern Africa.
According to the Tanzania Ports Authority, the Dar es Salaam Port handles approximately 95 per cent of the country’s international trade and serves these landlocked markets, as well as Zimbabwe.
The scale of this regional market is reflected in the growth of transit cargo. Volumes passing through Dar es Salaam Port increased by 17 per cent to 14.61 million tonnes in the 2025/26 financial year, with the DRC accounting for 7.77 million tonnes, Rwanda 2.18 million tonnes and Zambia 3.41 million tonnes, according to official figures.
The Central Corridor, which connects the Dar es Salaam Port to Burundi, the DRC, Rwanda and Uganda, alongside regional transport links serving Malawi and Zambia, creates demand for businesses that can improve freight coordination and cargo visibility.
Potential opportunities include digital freight-booking systems, cargo tracking, electronic payments, logistics coordination and cross-border delivery services.
One of the Tanzanian entrepreneurs already exploring this market is CargoLink founder Azizi Chamani, whose digital freight platform seeks to connect shippers, truck owners, drivers and freight forwarders.
Chamani said the idea emerged from inefficiencies in cargo transportation, particularly the movement of trucks returning without loads after delivering goods inland or arriving empty at Dar es Salaam Port to collect shipments.
“I was inspired by the inefficiencies I observed in the logistics chain, where thousands of trucks either return empty after offloading cargo inland or arrive empty at the Port of Dar es Salaam to pick up new shipments,” he said.
The platform allows businesses to advertise available cargo, connect with transporters, book shipments and make digital payments, while GPS tracking provides visibility during transportation.
Chamani said the business was seeking between $1.5 million and $2 million to expand its operations across Tanzania and into regional markets, illustrating the scale of financing required by startups seeking to develop local solutions into businesses with wider geographical reach.
Beyond freight transportation, agricultural supply chains also offer opportunities for startups seeking to address the cost and reliability of moving goods between producers and consumers.
Baraka Chijenga, Kilimo Fresh Foods Africa Ltd co-founder, said weaknesses in logistics could affect the competitiveness of agricultural producers, particularly when delays and high transportation costs reduce the value of products before they reach markets.
“Efficient logistics are essential to connecting producers with markets, particularly in agriculture, where delays and high transportation costs can reduce the value of products before they reach consumers.
“Tanzania has an opportunity to support startups that use technology to improve the movement of goods, connect farmers with buyers and make supply chains more reliable.
“Solving these challenges would create business opportunities while improving the competitiveness of local producers,” he said.
Nevertheless, turning these opportunities into commercially successful businesses will depend on addressing broader structural challenges affecting Tanzania’s logistics sector.
The Japan International Cooperation Agency estimates that logistics costs account for between 35 and 45 per cent of Tanzania’s import costs, while more than 95 per cent of freight transportation depends on roads. It has called for stronger connections between road, railway and maritime transport to improve efficiency and reduce dependence on trucking.
Tanzania’s Dira 2050 similarly identifies underinvestment in digital technologies, regulatory fragmentation, inefficient storage and handling facilities, and a shortage of skilled logistics personnel among the challenges facing the sector. It calls for investment in multimodal transport, digital infrastructure and public-private partnerships.
These constraints show that investment in logistics startups cannot be separated from improvements in the wider operating environment. Businesses developing digital freight platforms, for instance, need reliable transport infrastructure, efficient cargo-handling systems and regulations that facilitate operations across different markets.
There is also a need for entrepreneurs to strengthen their internal business systems and demonstrate their readiness to manage investment.
Startup mentor and entrepreneur Michael Nyamwero said startups needed to go beyond developing innovative products and establish the management and financial structures required to convince investors of their long-term potential.
“One of the biggest challenges for startups seeking investment is demonstrating that they can grow beyond an initial idea.
“Entrepreneurs must build strong management systems, understand their markets, maintain reliable financial records and show investors how their businesses will generate sustainable revenue.
“If Tanzanian startups are to benefit from Africa’s growing logistics investment, they must prepare themselves to meet investor expectations and compete across regional markets,” he said.
On the financing side, the government has proposed establishing a venture capital fund to widen access to capital for innovative businesses.
Speaking during Tanzania Startup Week 2026, Minister Omar said the proposed facility would operate through professional fund managers, with private-sector investors expected to contribute between 20 and 30 per cent.
“We plan to have a fund of funds, which basically means the fund should not be investing directly in the startups but through fund managers,” he said.
However, the proposed financing mechanism is only one part of the support required to strengthen the ecosystem. Startups also need an environment in which businesses across different sectors can access opportunities and compete for investment based on their commercial potential.
On top of that, Tanzania Startup Association Chief Executive Officer and co-founder Zahoro Muhaji said the focus should be on making the country an attractive destination for startups and digital economy investment without favouring particular industries.
“We do not choose or discriminate between sectors. This is a fair game; whoever succeeds should succeed. We want people to think of Tanzania as a destination for startups and digital economy investment, and that should apply to all types of startups,” he said.
