Nigeria’s Most Promising Tech Startups

Nigeria is a dominant force in the tech space and has consistently accounted for a majority of the funding that comes to Africa. Here’s why.
Nigeria’s Most Promising Tech Startups
Osita Uwam

The tech ecosystem in Africa has grown extraordinarily over the years, which explains why capital inflow in the form of venture capital has been on the increase from a mere $400M in 2015 to $2BN in 2019 according to Disrupt Africa. In 2021 alone we have seen over $1.19BN investment in the first 6 months of the year.

Nigeria has been a dominant force in the tech space and has consistently accounted for a majority of the funding that has come to the continent.

Nigeria and South Africa accounted for 28% of the total funding that came into the continent.

With Flutterwave raising $170M series which values the company at over one billion dollars, Kuda raising $80M series A and B valuing the company at $500M, and Opay rasing $400M valuing the company at $2BN, makes Nigeria one of the most sought after markets on the continent.

There are numerous startups springing up in the country in various spaces such as Fintech, Edutech and health tech companies, but there are a few that have strong potential of becoming the next major startups in the country.

Below are some of the most promising startups in Nigeria right now:

1. Mono

A Nigerian based startup that allows companies and businesses to easily access the financials of their customers by just plugging into their API.

As credit penetration continues to expand in Nigeria, accessing a customer’s financials is key to identifying if the customer has the financial capabilities to repay their debt.

The conventional process of manually submitting bank statements increased the time required to process applications and left room for bank statement manipulation. With the advent of Mono, businesses and financial lenders can easily access the financial statements of their customers and make real time decisions within minutes.

The company was founded August 2020, and has since gone on to raising over $2.65M in funding. In February the company announced that it was accepted into the Y combinator program.

2. Lemonade Finance

Cross-border payment has been one of the major issues for Africans — especially for Nigerian students studying in the UK, US and Canada — as sending money from Nigeria and receiving has proven difficult over time.

The Lemonade app makes cross-border payments to and from Nigeria easier and more affordable.

Lemonade Finance has poised itself to solve this problem by providing an app that enables Nigerians in Canada to send money back home, as well as allowing Nigerians to send money to the UK, Ghana, Europe & Kenya at very competitive rates.

The startup launched in 2020 has raised $125,000 and was accepted into the Y combinator program.

3. Chaka

As a young Nigerian, investing in foreign stocks had been nothing but a dream and a luxury only available to the ultra-wealthy who continually build wealth. With the advent of Chaka, the dream of foreign stock investment has become a reality — with a fraction of the amount required and at a reduced cost.

Chaka is a Fintech company looking to change how Nigerians invest in both foreign and local based investment products like stocks, bonds, mutual funds and ETF’s.

With Nigeria’s increasing inflation rates and very few assets yielding a positive real rate of returns, Nigerians are pushed to invest in more developed markets with a solid rate of returns and growth rate.

This startup allows its clients to invest with as little as $10 and a 1% trading fee that reduces as its clients take on more trades. The company also continually educates and informs its client base on investing and portfolio diversification and management.

Chaka is currently the only SEC-regulated investing platform in the country and recently raised $1.5M in pre-seed funding.

4. Kwaba

The Nigerian rental market is one of the largest in Africa with over 50% of the populace being renters, compared to 29% in Ghana according to CAHF. However, the biggest problem with home rental in Nigeria is that landlords require tenants to pay their full annual or biannual rental upfront.

With over 2.1 Trillion Naira ($5BN) paid in rent in urban areas according to a report by the Nigerian Bureau of Statistics, this poses a huge problem for the people as the majority can’t actually afford to pay these large sums upfront.

Kwaba helps average Nigerians pay their rent upfront and pay it back in installments.

By providing its “rent now, pay later” scheme, the startup has been able to help finance many customers in the space of 18 months. Since its inception in 2020, the demand for the company’s services have been on a continual increase due to its low interest rates compared to other financial institutions.

Kwaba is looking to provide more financial products that will be beneficial to its customers in the coming years. The company has raised an undisclosed amount from Ingressive capital.

About the author

Osita is a passionate Business Developer who believes in Africa’s growth. His interest spans between the African real estate market and tech market with interest in real estate financing, acquisition, development, private equity and venture capital. He currently works as the Growth Lead at Kwaba, where he builds partnerships, carries out market research, identifies business opportunities that the company can capitalize on. When he isn’t working he enjoys real books on real estate, finance, investing and tech. He equally enjoys travelling, swimming and cooking. Twitter- @therealosi Instagram- @osi_u

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