The Nigerian startup ecosystem has witnessed growth over the years. Lagos, Nigeria’s megacity, has been described as Africa’s most valuable startup ecosystem and many factors account for the pride of Lagos as the hub of startups on the African continent. The most significant is the market size of Lagos, which has seen investors bet on the country’s technology ecosystem. This was acknowledged by the Meltwater Entrepreneurial School of Technology (MEST), which opened its first incubator in Lagos on November 21, 2016. Despite this growth, the local startup ecosystem is limited to tech-savvy Nigerians, while most people are not informed about it. Even at the popular computer village in Ikeja, Lagos, there are more traders than tech-savvy people looking to explore opportunities in the Nigerian startup ecosystem.
Secondly, Lagos is home to some of the continent’s leading e-commerce platforms such as Jumia and Konga and has also given rise to some leading startups of the continent such as Andela, iROKO and Flutterwave. Andela is a software warehouse that recruits and trains talented software developers for the global economy; Flutterwave is an online payment solution provider aiming to build payment infrastructure that connects Africa to the global economy; and iROKO is Africa’s first mainstream online streaming website with access to more than 50,000 Nollywood film titles.
These startups are known to have attracted global investors from the Silicon Valley. This was acknowledged in the 2017 Global Startup Ecosystem Report which estimated the Lagos startup ecosystem is worth US$2bn. According to TechPoint Funding report for the first quarter of 2020, Nigerian startups raised $55.37m with more than 99% funding accruing from foreign investors. It is estimated that Fintech startups accounted for 82.2% of the total funding and less than 1% of the total sum raised was from local funders.
Lagos remains the hub for startups in Nigeria and continues to attract global attention. Startups have attracted more early-stage funding in Lagos than anywhere else on the African continent. In May 2019, Microsoft opened one of its African Development Centre sites in Lagos aimed at recruiting world-class Nigerian talent to create innovative solutions for global impact. Also, in December 2019, the Lagos State government launched a $700,000 fund dedicated to tech startups.
Consequently, the Nigerian startup ecosystem has caught global attention attracting leading global technology icons from the Silicon Valley. Facebook’s founder Mark Zuckerberg, Microsoft’s CEO Satya Nadella and Google’s CEO Sundar Pichai, have all visited Nigeria, to explore investment opportunities in the country’s startup ecosystem. Both Facebook and Google have tech investments in Nigeria. Facebook opened its first tech hub in Lagos in 2017 while Google opened its first Google Launchpad Space outside the United States in Lagos in the same year. Subsequently, Google also hosted its first ever Google Developers Launchpad Start for startups in Lagos.