Nigeria’s $5 Billion Startup Funding Under Threat: Matters Arising

Nigeria’s ambitious goal of attracting $5 billion in startup funding by 2027 is facing serious headwinds, as investment inflows continue to shrink. 

Funding dropped dramatically from $1.2 billion in 2022 to an estimated $400 million across 2023 and 2024. Once Africa’s leading startup investment hub, Nigeria has now slipped to fourth place, trailing behind other emerging ecosystems on the continent. This sharp decline raises concerns about whether the country’s startup scene can maintain the momentum needed to reach its funding target within the next few years.

While global economic shifts have played a role in the slowdown, domestic challenges remain major stumbling blocks. Issues such as erratic power supply, policy inconsistency, and regulatory uncertainty continue to deter both local and foreign investors. Questions are also being raised about the effectiveness of the Nigeria Startup Act, which was introduced to support innovation and bridge funding gaps. For Nigeria to reverse this trend, it must not only restore investor confidence but also create a more stable and enabling environment for startups to thrive.