Too Many Startups? Not in Nigeria – Untapped Opportunities Await Innovative Companies
In recent times, there has been a prevailing belief that Nigeria’s startup ecosystem is becoming overcrowded, but Victor Oyedokun, CEO of Paytev Technologies Limited (A fast growing FINTECH platform in Nigeria), Tivahub (A web hosting company) strongly disagrees. He believes that the idea of having “too many startups” is a significant misconception. While Nigeria’s startup ecosystem is undoubtedly vibrant and expanding, data and market trends show there is still substantial room for impactful innovation and growth.
Here’s why Oyedokun argues against the oversaturation myth:
1. Low Startup Density Relative to Population Size
Nigeria’s population exceeds 220 million, but its startup density remains low in comparison to global standards. Oyedokun points out that in the United States, there are roughly 5,000 startups for every million people. However, this number is considerably lower in Nigeria. With increasing digital adoption and a massive population, there is a vast unmet demand for digital services, particularly in sectors like financial technology, healthcare, and e-commerce.
2. Gaps in Financial Inclusion
Nigeria still faces significant challenges with financial inclusion, as nearly 40% of the population remains underbanked or unbanked. This presents a tremendous opportunity for fintech startups that aim to expand access to financial services. Many individuals and small businesses continue to rely on cash-based or informal transactions. Oyedokun emphasizes that startups in this sector are critical in bridging the financial inclusion gap, empowering millions who lack access to traditional banking systems.
3. Youth and Technology-Driven Demand
Nigeria is one of the world’s youngest nations, with a median age of around 18 years. This digitally savvy youth demographic is eager for modern and efficient solutions across all sectors. Oyedokun explains that this young population fuels the demand for startups in sectors like e-commerce, health tech, agriculture, and education technology (edtech). He believes that Nigeria’s market is still in its early stages, barely scratching the surface in addressing the dynamic needs of this population through technology-driven solutions.
4. Global and Local Investment Confidence
Despite global economic uncertainties, Nigeria continues to attract substantial investments. According to a report from Disrupt Africa, the country remains one of the top destinations for startup funding in Africa. Oyedokun shares that in 2021 alone, Nigeria’s startup ecosystem raised over $1.5 billion in investments, highlighting ongoing confidence from both local and international investors. He notes that the entry of venture capital firms, accelerators, and corporate partnerships underscores the abundant opportunities for startups to address market gaps and drive technological advancements.
The Untapped Potential
Victor Oyedokun believes that Nigeria’s startup ecosystem is not oversaturated but rather is growing and evolving to meet the needs of a large, underserved, and young population. He notes that there are still significant gaps in various industries and an increasing demand for digital services. Startups have a crucial role to play in improving access, driving economic growth, and enhancing Nigeria’s technological capabilities.
Rather than “too many startups,” Oyedokun argues that Nigeria has too many untapped opportunities waiting for innovative, problem-solving companies to step in.
(c) Victor Oyedokun
