Tech startups employ nearly 20k amassed by 481 firms
By Jeph Ajobaju, Chief Copy Editor
Three fintechs – Renmoney, Cowrywise, and Flutterwave – are the leading fintech employers in Nigeria where a total 481 tech startups have a combined workforce of 19,334 as of August, according to tracking by Disrupt Africa.
Nigerian Startup Ecosystem Report by Disrupt Africa shows the top three with a total 2,003 employees. RenMoney 892, Cowrywise 570, Flutterwave 541.
The report shows fintech is by far the biggest employer within the broader startup ecosystem, accounting for 8,653 jobs.
Six of the 10 biggest startup employers are fintechs – RenMoney (892), Cowrywise (570), Flutterwave (541), TeamApt (460), FairMoney (385), and Kuda (356).
“Nigerian startups employ a combined total of 19,334 people, dwarfing the 11,340 employed by their counterparts in South Africa,” the report said.
“The average headcount per startup stands at 40. The fintech industry accounts for almost half of Nigerian startup employment, with 8,653 jobs, while between them the fintech, e-commerce, mobility and logistics, and e-health spaces account for 74.9% of all jobs.
“Fintech startups are by far the most common within the Nigerian startup ecosystem, as they are within most other established ecosystems on the continent.
“A total of 173 companies, 36% of the 481 ventures tracked in this report, fall into this category, a figure that is three times larger than the next most populated space, e-commerce, and retail-tech.
“Fintech tends to draw the most attention in the majority of Africa’s startup communities, as well as the lion’s share of funding.
“In terms of sub-sectors, activity is diverse, though payments and remittances (46 startups, 26.6% of Nigerian fintech ventures) and lending and financing (34 startups, 19.7% of Nigerian fintech ventures) are clear leaders.”
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Much to celebrate
“There is much to celebrate about the tech ecosystem in Nigeria,” Kofoworola Agbaje, Senior Investment Associate at Quona Capital, per reporting by Nairametrics.
“Despite the macroeconomic headwinds and numerous regulatory hurdles, the special breed of entrepreneurs, investors, and operators working in Nigeria have continued to succeed and rake up achievements.
“Nigeria remains the top VC market on the continent with startups having raised over US$3.7 billion since 2019.
“In Nigeria (and even on the continent), fintech remains the top industry both in terms of the number of deals and funding amount.
“This year alone, fintech startups (excluding fintech adjacencies and enablers) account for more than 60% of the total funding amount raised by startups in Nigeria.
“The impact of these achievements on the market has been enormous.”
Other highlights
The report affirms Lagos as the hub of Nigeria’s startup ecosystem and the leading startup city on the continent, alongside the likes of Cape Town and Nairobi.
No fewer than 425 (88.4 per cent) of Nigerian tech startups tracked by the report are based in the Lagos. Abuja comes a poor second with 23. Activity is also in evidence in 13 other locations.
The busiest year on record for the founding of Nigerian fintechs was 2021 when 31 of the firms tracked opened shop. Up to 27 launched in 2020 and 28 in 2019. The number discovered to have opened so far in 2022 is three.