Lagos’s entrepreneurial culture, sustained by millions of energetic businesspeople in locations across the city, is evolving with the times.
Lagos is known to be home to numerous local and multinational companies, as well as hundreds of thousands of small, informal sector businesses. Today, it also hosts a budding startup ecosystem that’s grabbing international headlines.
Lagos is a space with great potential, being thrust forward by founders and teams in financial technology, edutech, healthcare, waste recycling, retail, software development and other ventures.
Lagos’s startup ecosystem – the network of new generation businesses enabled by technology – is Africa’s largest, according to Startup Genome’s 2017 Global Startup Ecosystem Report and Ranking. The report values the city’s startup ecosystem at $2 billion, putting it above South Africa’s Johannesburg and Cape Town in terms of worth.
Although Lagos isn’t on the report’s list of global startup hubs, it features alongside other regional leaders from North America, Asia, Europe and Africa. On the African continent, it comes in second behind Cape Town with respect to the number of active startups, with between 400 and 700 startups operating within its metropolitan area. Projections for the ecosystem indicate that it should see a significant expansion over the next few years, as internet connectivity, average incomes and an increased adoption of new globally accepted ways of doing business continue to deepen.
About 59% of startup founders in Lagos have an undergraduate degree; 93% of them also have a technical background – the third largest rate in the world. About 14% of founders are women – a low percentage, but not very far behind the global average of 16%.
Nigeria’s startup scene has continued to grow in prominence, with investors picking out potentially high yield ventures based in Lagos and staking large sums in funding on them. While early stage funding per startup is put at $77,800, a number of Lagos-based startups have attracted much larger capital from high profile investors, including some from Silicon Valley. A case in point is Flutterwave, a fintech startup which secured $10 million in series A funding from a group of investors led by Greycroft Partners and Green Visor.
Lagos’ emerging startup ecosystem has a lot of room to grow further still. There are obstacles in its path; infrastructure remains a major challenge, as its power and internet connectivity are far from adequate. But the train has left the station, the city is on the move, and the pull of global trends and local necessities will all but ensure that Lagos’s startup scene morphs into a true world-beater in the coming years.
Feature image photo credit: appsafrica.com