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Foreigners spent $85.8m on Nigerian start-ups in 2020 – Report

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Ben Nwosu

In 2020, Nigerian start-ups owed 71.2 per cent of their investments to foreign funders, according to a report.

Techpoint Africa’s annual Nigerian start-up report revealed that foreign investors contributed $85.8m out of the approximately $120.6m that Nigerian start-ups raised throughout the year.

The report stated that the year-on-year funding size comparison however was only 22.73 per cent of the $377.4m recorded in 2019 figure and 48.12 per cent of the $178.3m recorded in 2018. The decline could be attributed to the economic challenges resulting from the COVID-19 pandemic.

The share of foreign deals in 2020 was 37, local number of deals was 14 and both foreign and local share of deals was nine.

Foreign deals share shows a 30.1 per cent decline from 53 deals recorded in the previous year, while local deals share in 2020 had 80.3 per cent decrease from 111 deals recorded in 2019.

It also said foreign investments made up the larger part of Africa’s start-up funding, as disclosed in its West Africa Decade Report.

A total of 81.3 per cent of investments in West African start-ups that had raised at least $1m in the last ten years came from outside the continent, according to the report.

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