{"id":16269,"date":"2025-06-26T12:28:09","date_gmt":"2025-06-26T12:28:09","guid":{"rendered":"https:\/\/www.europesays.com\/us\/16269\/"},"modified":"2025-06-26T12:28:09","modified_gmt":"2025-06-26T12:28:09","slug":"nigerias-5-billion-startup-funding-target-shaky-as-economic-realities-set-in","status":"publish","type":"post","link":"https:\/\/www.europesays.com\/us\/16269\/","title":{"rendered":"Nigeria\u2019s $5 billion startup funding target shaky as economic realities set in\u00a0"},"content":{"rendered":"

The ambitious $5 billion funding target for Nigerian startups set by the Minister of Communications, Innovation, and Digital, Dr. Bosun Tijani, is becoming infeasible with the continuous decline in funds attracted by the country\u2019s innovators in recent times.\u00a0<\/p>\n

Going by the Minister\u2019s plans unveiled upon assumption of office in 2023, this target is to be achieved in 2027 by ensuring a 50% increase in funding each year from the $1.2 billion attracted by the startups in 2022.\u00a0<\/p>\n

However, data from 2023 and up to Q1 2025 suggests otherwise, as funding continues to decline.<\/p>\n

At the end of 2023, Nigeria slipped from the top position it occupied for years to become 4th in Africa as startups in the country managed to raise about $400 million, marking a significant decline from 2022.<\/p>\n

In 2024, the country\u2019s startups also raised about the same amount<\/a> and remained among the top 4 in Africa in terms of funds raised for the year.<\/p>\n

According to data tracked by the Nairametrics Dealsbook,<\/strong> Nigerian startups raised around $100 million<\/a> in Q1 2025. While this showed some resilience in the face of the current global capital tightening, it fell far short of the growth required to meet the country\u2019s 2027 target.<\/p>\n

Why is funding declining\u00a0<\/strong><\/p>\n

Industry analysts believe a combination of factors is driving the decline in startup funding, not only in Nigeria but globally.<\/p>\n

These factors include rising global interest rates, a shift in investor focus, and persistent challenges within Nigeria\u2019s startup ecosystem.<\/p>\n

According to the founder of Startup Arewa, Jega Mohammed, venture capitalists are now looking toward other verticals such as Artificial Intelligence, big data, cybersecurity, automation, and blockchain, hence the decline in regular tech startup funding.<\/p>\n

For the founder and CEO of Kippa, Kenedy Ekezie, whose company benefited from the funding boom between 2021 and 2022, raising a total of $11.6 million, the dynamics have changed, and startups will have to look inward for funding.<\/p>\n

\u00a0\u201cThere is a global capital meltdown happening right now, and fundraising has slowed down for startups worldwide, including in Africa.\u00a0 As it is now becoming harder to raise capital in the current market and external funding becomes more challenging, Nigerian startups will have to rely less on outside funding and look for more local investors,\u201d he said.\u00a0\u00a0<\/p>\n

Beyond funding, Nigerian startups face policy challenges\u00a0<\/strong><\/p>\n

A recent report by\u202fStartup Graveyard identified funding shortages as the primary cause of African startups\u2019 failure in 2023 and 2024.<\/p>\n