Starting A Business In Nigeria? Family And Friends Are Your Best Bet For Capital

February 16, 2015

“As a first-time entrepreneur, your first source of funding should probably be your friends, family or personal savings, before seeking angel or VC funding,” says Ozioma Obiaka, a Director at TalentBase, a Lagos-based HR and Payroll software provider.

Ozioma is part of a growing wave of Nigerians who have come back to Nigeria after several years of studying and working in the Diaspora.

Positive Macroeconomic trends in emerging economies, and economic stagnation in the West, have drawn numerous repatriates (repats) to Nigeria.

While many repats have found opportunities in emergent professional sectors such as investment banking and consulting, a recent McKinsey Global Institute study on Nigeria (Nigeria’s Renewal, July 2014), found that Nigeria is developing a large consumer class who by 2030, are projected to number 160 million, and triple their discretionary spending to almost $1 trillion.

Co-Founder of Easy Taxi Nigeria, Bankole Cardoso, also a repat, is particularly buoyant when discussing the opportunities in Nigeria: “The Nigerian market is ripe with opportunities that are not available in the West. With our youthful population there is a market for almost everything and over the next 20 years the Nigerian economy will become one of the biggest in the world.”

Many have the following things in common in their quest to raise startup capital: bootstrapping; capital from friends and family; and knowledge/access to Nigeria’s nascent network of startup incubators, angel investors, and venture capital.

Nigeria’s network of venture capital firms, angel investors, and startup incubators, may well be increasing in number, but according to Ozioma, “they typically want to see some form of progress before committing any capital to a venture.”

Source: AFK Insider

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