Nigeria has taken a significant step towards supporting its young investors in the tech and creative sectors by launching a $672 million fund. The aim is to assist those who are struggling to raise capital in Africa's largest economy, with a target audience of 15 to 35-year-olds. This move comes as concern grows about the failure of SVB Financial Group, which has been supporting startups in Nigeria.
Despite this, so far, only one startup,
cross-border payments firm Chipper Cash, has confirmed that it had $1 million
invested in SVB. The most prominent startups, such as e-commerce company Jumia
and Africa-focused fintech firm Flutterwave, told Reuters that they have no
exposure to the bank.
The Digital and Creative Enterprises
Programme (DCEP) was launched in the federal capital Abuja by Vice President
Yemi Osinbajo. The presidency said that the African Development Bank will
invest $170 million, Agence Francaise de Developpement will contribute $116
million, and the Islamic Development Bank will invest $70 million. The
government, through the Bank of Industry Nigeria, will provide $45 million,
while the private sector pledged $271 million.
Osinbajo stated that "DCEP is a
government initiative to promote innovation and entrepreneurship in the digital
tech and creative industries and especially targeted at job creation."
Nigeria has the most startups in Africa, mainly in tech and fintech. However,
despite funding from overseas banks and venture capital firms, most startups
still struggle to secure capital due to the collateral demanded by banks, which
they cannot provide.
This new initiative will provide much-needed
support for young Nigerian entrepreneurs, allowing them to create new
businesses, innovate, and develop creative solutions to drive job creation in
the country. As a result, it is hoped that Nigeria's tech and creative
industries will continue to grow and contribute to the country's economic
development.
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