When Olatunbosun ‘Bosun’ Tijani, co-founder of the influential tech hub CcHUB, was appointed Nigeria’s Minister of Communications, Innovation and Digital Economy in 2023, the ecosystem cheered. Here was an insider, a respected builder who understood the trenches, finally at the helm. He arrived with an ambitious target: to help the country’s startups raise $5bn by 2027.

Two years later, that optimism has curdled into a harsh reality. Nigeria’s startup ecosystem, once the undisputed king of African tech, is a shadow of its former self. High-profile, venture-backed companies like Edukoya, Okra, and several others have shut down, and the funding tap has run almost dry.

The numbers for the first half of 2025 paint a grim picture. Nigeria, for years the top destination for venture capital in Africa, has plummeted to a distant fourth place.

Africa’s H1 2025 Funding Race

According to data from Launch Base Africa, Nigeria has plummeted to a distant fourth place in the continental funding race, raising just $156.6m. The country now trails significantly behind its rivals, with South Africa leading the pack at ~$349.7m, followed by Egypt and Kenya in second and third place, respectively.

This decline is part of a larger, troubling trend. The country’s total funding for both 2023 and 2024 hovered around a bleak $400m annually — a catastrophic drop from the $1.2bn raised in 2022. The minister’s goal of a 50% year-on-year increase has not just been missed; it has been inverted.

A Toxic Economic Cocktail

While a global venture capital slowdown is partly to blame, Nigeria’s woes are compounded by a uniquely punishing local economic crisis. The government’s decision to peg the naira at ₦1,400 to the dollar in the 2025 budget — a 75% depreciation from the previous year’s ₦800 benchmark — has sent shockwaves through the economy.

With inflation soaring past 30% (before a controversial rebasing exercise), the naira’s freefall has made Nigeria one of the continent’s most challenging business environments. The consequences are stark:

• Corporate Exodus: International giants are fleeing. Microsoft shut its Lagos development centre last year, less than two years after a major investment. Unilever, Procter & Gamble, and ShopRite have also exited or scaled back.
• Plummeting Revenues: MTN, the country’s largest telco, saw a 48.7% revenue decline in Q3 2024, citing the naira’s depreciation. Payments firm dLocal reported an 80% year-over-year revenue drop in Nigeria during the same period.

Against this backdrop, the government’s policy initiatives have struggled to make an impact. The landmark Nigeria Startup Act, passed in 2022 to provide legal and fiscal support, has been slow to implement. While the government has begun “labelling” startups for official recognition and announced a $40m seed fund, these efforts are dwarfed by the scale of the crisis.

A Tale of Two Ministers?

While Nigeria’s tech ecosystem flounders, other African nations have demonstrated what focused government action can achieve. In Algeria, for instance, the Ministry of Startups, though also seeing a recent leadership change, has been credited with proactive initiatives.

Under its first-ever minister, Yacine Oualid, Algeria established a dedicated startup fund, a national accelerator, and sent cohorts of founders on international tours to hubs in the US and Asia to gain global exposure. This hands-on approach, aimed at systematically building capacity, stands in contrast to the situation in Nigeria, where an insider minister seems overwhelmed by macroeconomic forces and policy inertia.

For Nigerian entrepreneurs, famed for their resilience, this is the ultimate stress test. The combination of a global funding winter and a brutal local economic storm has created a crisis that even a minister from their own ranks is struggling to navigate. The $5bn funding dream feels more distant than ever; for now, the ecosystem is simply fighting for survival.