Lagos startups secure $820m early-stage funding, highest in Sub-Saharan Africa

A report by Startup Genome has shown that early-stage financing of startups in Lagos was about $820 million, the most in the Sub-Saharan African startup ecosystem.

The figure was arrived at by calculating the value of exits and startup valuation from the second quarter of 2020 to 2022.

Legit.ng earlier identified about 10 Nigerian startups selected among the 40 technology firms listed for the $4 million Black Founders Fund by Google. The list was drawn from Europe and Africa, with Nigerian startups dominating.

Lagos takes the lead

According to the report, Nairobi and Cape Town, with total startup valuations of $7 billion and $3 billion, respectively, were Lagos' closest competitors. The state's placement in the world's top emerging startup environment was between 51 and 60.

Regarding cash raised, it also discovered that OPay's $400 million Series C financing in August 2021 was the biggest deal in the sector, while Flutterwave's $250 million Series D financing in February 2022 lifted the company's valuation to about $3 billion.

The report's findings also indicate that from 2021 to 2022, venture capital (VC) funding in the area decreased by 6%. Fintech accounted for 41% of all startup deals in the region between 2018 and 2022, making it the top-performing technology sector in the area. According to reports, Nairobi is the largest fintech hub in the area.

The survey states that over 400 tech firms, or 88% of all tech startups in Nigeria, are located in Lagos. It also notes that the fintech industry dominates the Lagos tech ecosystem, accounting for 49% of all tech companies.