The Biggest Wins of the Nigerian Tech Ecosystem in 2020
The Nigeria tech space was significantly affected by the COVID-19 pandemic during the year. However, this did not stop the ecosystem from hitting highly impressive milestones.
While ride-hailing startups suffered a stall in operations due to lockdown restrictions in major states including Lagos and FCT, sectors such as e-commerce and logistics benefited hugely from the pandemic.
In terms of investments this year, Nigerian startups closed more funding rounds than those in any other country on the African continent. The year also saw a boom in crypto operations across Nigeria.
Despite inherent challenges, the Nigerian tech ecosystem has continued to progress remarkably. Here, we take you through the biggest wins scored by the Nigerian tech space in 2020.
Nigeria’s Biggest Ever Startup Acquisition
In October, Nigerian e-payments startup, Paystack, was acquired by US fintech giant, Stripe, in a deal reported to be worth over $200 million. At almost one-quarter of a billion dollars, Paystack’s exit deal became the biggest ever closed by a Nigerian startup.
Revealing the growing long-term viability of Nigerian tech startups, Paystack’s acquisition was a testament to the possibility of more multimillion-dollar exit deals happening within the Nigeria tech ecosystem.
It marked a momentous win for the Nigeria tech space on a global scale as more foreign capitalists, as well as local investors, take a closer look at Nigeria’s burgeoning tech market to identify the next Paystack.
Massive Funding Deals
With huge investments into startups in the country this year, Nigeria again showed why it remains Africa’s top funding destination. In January, fintech startup, Flutterwave raised $35 million in a Series B funding round to expand across Africa.
Like Flutterwave, Lagos-based renewable energy startup, Lumos also raised $35 million from the US Development Finance Corporation (DFC) to scale its solar energy solution in Nigeria.
In November, Nigerian digital bank Kuda secured $10 million funding – one of the largest ever seed round in Africa.
According to Startuplist Africa, Nigerian startups raised over $170 million in 2020.
Second Largest Crypto Market on Paxful
Nigerians did not just hop on the crypto bandwagon this year, they almost took over. The surge in crypto operations saw Nigeria become the world’s second-largest Bitcoin market on leading P2P exchange Paxful, second only to the United States.
Having traded over $566 million worth of Bitcoin on Paxful in five years, Nigeria cemented its position as a global player in the Bitcoin market this year.
It was great news for Nigeria’s crypto space, with the sector better poised to drive the gradual shift to digital currency and blockchain-based assets worldwide.
A Landmark for Medtech
In December, the Nigerian healthtech industry scored a big win as 54Gene unveiled Africa’s first Private Lab for human whole-genome sequencing in Lagos.
Partnering with US biotech company Illumina, 54Gene’s lab will facilitate molecular research and diagnostics of African biobank samples, thereby eliminating the higher costs and delay in test results associated with overseas transport.
The completion of the lab followed 54Gene’s $15 million Series A funding led by Adjuvant Capital in April.
Acquisitions by Nigerian Tech Startups
There were a number of notable acquisitions completed by Nigerian startups in 2020. Auto-tech company, Autochek fully acquired both Cheki Nigeria and Ghana in September, after which it raised $3.4 million pre-seed funding.
Also, Nigeria’s foremost innovation hub, CcHub acquired Kenyan Edtech startup e-Limu in October for an undisclosed fee. This came just over a year after the Lagos incubator completed the acquisition of Kenya’s iHub.
These deals showed the increasing financial strength among Nigerian startups and hubs, buoyed by sizable financing from global investors.
Apart from the above-listed, the number of Nigerian developers on GitHub grew by 65% in 2020, marking the highest percentage growth in contributors worldwide since 2019 – a proof that Nigeria has the fastest-growing community of developers in Africa.
This was how the Nigeria tech ecosystem fared in 2020, despite the disruptions caused by COVID-19. How will 2021 unfold?
If you’d like to get featured on our Entrepreneur Spotlight, click here to share your startup story with us.
Get latest Technology news, reviews, business-related content with a deliberate emphasis on the African narrative and insightful analysis in Nigeria – straight to your inbox.