The Federal Government has set an ambitious goal to boost yearly capital inflow into Nigeria’s startup ecosystem from $1 billion to $5 billion by 2027. This was disclosed by the Minister of Communications, Innovation and Digital Economy, Dr. Bosun Tijani, during a recent interview. According to him, achieving this target is critical to ensuring the global competitiveness of Nigeria’s startup sector.
Dr. Tijani highlighted the government’s ongoing collaboration with the startup ecosystem to make this vision a reality.
“About 15 years ago, Nigeria was not even considered a destination for investments in technology startups,” he recalled. “Today, it ranks among the top three tech startup destinations globally.”
He cited companies like Paystack, Flutterwave, and LemFi as examples of Nigerian startups thriving on international funding. “Ninety percent of the funding that comes into Nigeria originates from the San Francisco Bay Area, the fourth-largest economy in the world. To raise money, many of these companies join programs like the Accelerator Programme, but there’s a limit to how much they can access due to competition from other startups,” Tijani explained.
The minister emphasized the government’s determination to scale up funding: “By 2027, we aim to increase annual inflows to $5 billion, significantly expanding opportunities for startups.”
Insights on Africa’s Startup Investment Trends
As Nigeria targets a surge in startup funding, a report by Africa: The Big Deal revealed that over 430 African startups raised at least $100,000 in 2024, supported by more than 520 investors. However, this marks a decline from 2023 (610+ investors) and 2022 (1,000+ investors).
The report identified 54 Collective (formerly Founders Factory Africa) as the most active investor in 2024, with 26 deals completed. Other notable players include Techstars and Launch Africa, which have consistently featured among top investors since 2021.
New Initiative to Attract Tech Investments
In a bid to boost funding and investment, Nigeria has launched the Technology Export and Digital Trade Desk in collaboration with the Federal Ministry of Industry, Trade and Investment. This initiative aims to attract more investments into the tech sector and propel annual startup funding to $5 billion.
Dr. Tijani described the initiative as a significant milestone: “This marks a crucial step in strengthening the ICT sector’s contribution to Nigeria’s economy. Trade, which is the fifth pillar of our strategic blueprint, offers a unique opportunity to promote Nigerian technology exports.”
The initiative seeks to increase the tech sector’s GDP contribution from its current 14–18% to 21% within three years. It also aligns with Nigeria’s ambition to improve its ranking on the Economic Complexity Index (ECI), which evaluates a country’s productive knowledge and export diversity.
Boosting Economic Complexity
Nigeria’s ECI ranking stood at -1.67 in 2022, placing it 127th out of 133 countries. The government’s efforts to expand trade and diversify exports form part of President Bola Tinubu’s broader vision of a $1 trillion Nigerian economy driven by innovation and investment.
Once the leading destination for startup funding in Africa, Nigeria slipped to second place in 2023, overtaken by Kenya. However, with new initiatives like the Trade Desk, the government aims to reclaim its top position and create a thriving, globally competitive startup ecosystem.
