Nigerian fintechs retain African top spot in 8M 2022
By Jeph Ajobaju, Chief Copy Editor
Fintechs received $507 million investment in the first eight months of the year to August (8M 2022), retaining their slot as Nigeria’s best funded sector for seven years running.
Fintechs accounted for 67.8 per cent of total funding by 8M 2022, according to a report by Disrupt Africa on the Nigerian ecosystem.
“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 said.
Total fintech investment in 2021 was $536.66 million, above $89.34 million 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 reflects both increasing investor confidence in Nigerian ventures and maturation of the ecosystem with solid companies taking on investment across the startup lifecycle.
Generally, Nigeria attracts the highest number of investors of any African country, the report said, noting that between 2015 and 2022, at least 641 entities made equity investment in its tech startups.
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Growth has taken off since 2020
“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, per reporting by The PUNCH.
It explained Nigeria has the best established local investment scene in Africa but the majority of the activity is at the early stages.
Venture capital firms such as Ventures Platform, Microtraction, GreenHouse Capital, and Future Africa deserve key mentions, the report stressed, “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.”