The Nigerian Fintech ecosystem attracted $507m investment funding from the beginning of the year till August.
This is according to a report by ‘Disrupt Africa on the Nigerian ecosystem’.
According to the report, Nigeria’s fintech has been the best funded of any sector each year since 2015, and investment was on the increase.
It stated that “So far in 2022, the space has already attracted $507m – accounting for 67.8 per cent of Nigeria’s total funding for the year to date. The growth in the amount of investment going to Nigeria’s fintech sector is also astonishing, particularly so in the past couple of years when the total amount of fintech funding has begun to top the half billion dollar mark.”
The report stated that the total funding attracted by fintechs in 2021 amounted to $536.66m, which was an improvement to the $89.34m recorded in 2020.
It added, “So far this year, the largest disclosed round went to Flutterwave, which bagged $250m Series D in February. Compare this to the highs of the early years – $13m in 2015, $1.3m in 2016, $10m in 2017 – and the scale of the growth is evident.”
The new record rounds reflected both the increasing investor confidence in Nigerian ventures, as well the maturation of the ecosystem with solid companies taking on investment across the startup lifecycle.
Generally, the report said, Nigeria attracts the highest number of investors of any African country.
In the report, between 2015 and 2022, at least 641 entities made equity investments into the country’s tech startups.
Especially in comparison to the continent’s closest contenders, South Africa and Egypt, had seen activity from 382 and 203 investors respectively over the same period, and the scale to which Nigeria was leading is evident.
“Growth in the annual number of investors in Nigeria has really taken off since 2020, when suddenly the number hit triple digits. That year there was activity from 133 investors. In 2021, the tally grew to 323. So far in 2022, 281 entities have made equity investments,” the report said.
It explained that Nigeria has a well-established local investment scene than most of its continental counterparts, but the majority of the activity was at the earlier stages.
According to the report, VC firms such as Ventures Platform, Microtraction, GreenHouse Capital and Future Africa deserve key mentions, “but their funding is also supplemented by international capital. Also of note is an active local angel investor scene, with successful founders ‘paying it forward’ and funding the next generation. At later stages, startups rely on overseas investors, who make up the majority of the capital providers in the country.”
