Why Lagos is slowly overtaking Nairobi as Africa's leading startup capital
Last year, Nigeria attracted more investment than any other startup ecosystem in Africa.
It is arguably the continent’s most valuable ecosystem with its startups typically raising far more in early-stage funding. It serves as home to e-commerce heavyweights such as Jumia and Konga and has birthed some of the continent’s best known startups including Andela, iROKO and Flutterwave which have all attracted major global investor interest.
Lagos has seen its ecosystem grow rapidly thanks to the development of the “Yabacon Valley.” Last year, Nigeria attracted more investment than any other startup ecosystem in Africa.
Online social networking giant Facebook said it will open a tech hub in Lagos, its first in Africa, sometime next year with incubation programs for startups and developers. Moreover, the social network giant will run training programs for 50,000 Nigerians as part of a digital skills training program.
Facebook’s decision to deepen its operations in Nigeria comes a little over a year after Mark Zuckerberg, its CEO, chose Lagos for his first visit to Africa.
Google likewise announced the company’s plans to open its first Google Launchpad Space outside the United States in Lagos. The announcement came in July this year during Google CEO Sundar Pichai's first visit to Lagos.
Earlier this month, it hosted the first ever Google Developers Launchpad Start, a one week long boot-camp, for early stage startups in Lagos.
The two tech giants have their eyes set on boosting their business in Africa’s largest economy thanks to a aligning factors such as increased smartphone adoption and falling internet costs.
Even then, the potential size of the market can simply not be ignored. Nigeria remains Facebook’s biggest market in Africa and Google’s Maps service user numbers in Nigeria have doubled in the past year.
Nigeria's market size has also drawn attraction from Meltwater Entrepreneurial School of Technology (MEST), an entrepreneur training program with roots in Ghana.
MEST has invested more than $20 million in African entrepreneurs so far. Last year, it kicked off plans to build a pan-African presence and Lagos, “the largest market by far,” was the obvious choice says Aaron Fu, managing director, MEST.
The incubator plans to host 12 companies its first year in Lagos.
This shift in start-up capital status from Nairobi to Lagos is a view shared by many entrepreneurs who argue that they are now seeing the quality and not quantity of Nigerian startups.
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