The Tech Revolution: Nigeria's Path to Economic Change
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Chapter 1: The Power Shift in Nigeria
In a nation where wealth is often entwined with political power, a new wave of innovators is striving to change the narrative. This is their journey.
In 2016, a former Nigerian president claimed responsibility for creating 25 billionaires, including Africa's richest woman, Folorunsho Alakija. This revelation, unsurprising to the educated populace, underscored how wealth was concentrated among a minuscule elite—those who gained their fortunes not through merit, but through political affiliations.
A closer look reveals that these billionaires predominantly hail from sectors like banking, oil, and cement, where they operate monopolies and benefit from dubious government contracts. Their wealth is further bolstered by a longstanding subsidy on fuel prices that benefits them at the expense of everyday Nigerians.
The implications for Nigeria's 200 million citizens are stark: wealth remains tightly held by a few, leaving millions in economic limbo. The current and past administrations have consistently favored their wealthy allies, neglecting the growth of small to medium enterprises.
Faced with limited support from banks and affluent citizens, a generation of young Nigerians has decided to forge their own paths, creating an ecosystem that is less reliant on governmental ties. Their results have been remarkable.
In 2009, Stanford-educated Tayo Oviosu launched Paga to address the challenges of cash transactions. His platform allows users to send money via mobile devices or laptops, and recipients don’t need to be registered to receive funds. Paga has since expanded to facilitate various payments, attracting interest from Silicon Valley and enabling Oviosu's expansion into other African markets, including state-controlled Ethiopia.
What initially seemed like Paga's unique success has now evolved into a broader trend. In early 2021, six Nigerian startups collectively secured hundreds of millions in investments, surpassing the totals from previous years.
Flutterwave, for instance, raised $170 million, becoming the first African-founded fintech company to achieve a valuation of over $1 billion. Other firms, including Kuda Bank and Havenhill Nigeria Limited, also attracted significant funding, showcasing the entrepreneurial spirit thriving in Nigeria.
Despite the initial apprehensions regarding the pandemic's impact on the economy, these investments reflect a growing confidence among venture capitalists in Nigeria's young, innovative leaders. This new wave of startups is disrupting traditional avenues of wealth creation, prompting established oligarchs to belatedly launch their own ventures in a bid to compete.
Unlike infamous figures involved in internet fraud, a determined cohort of young Nigerians is rewriting their narrative, shaping their nation on their own terms. Thousands of visionary entrepreneurs are poised to emerge, marking just the beginning of a transformative era.
The 21st-century African Renaissance is here, and its revolution is unfolding before us.
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References:
- Africa Business Revolution by Leke, Chironga, and Desvaux.
- Wikipedia
- Techpoint Africa
- Bloomberg