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Subscribe to our myFT Daily Digest email and stay informed about the latest news on the African economy every morning. The story of Ifeoluwa Dare-Johnson, a start-up entrepreneur in Nigeria, began with a personal tragedy. Her father passed away from a treatable condition that no one in the family knew he had.
“When I received the call that my father had passed away, everything changed for me. I realized that no matter how ambitious you are, good health is essential for success,” she says. “He had diabetes and hypertension for a long time, and no one had any idea. He didn’t think it was necessary to get a check-up, and one day, he just collapsed.”
Her grief was intertwined with a sense of guilt because she had a background in medical science and understood the importance of regular check-ups. “I started asking my friends, and it seemed like no one was paying attention to their own health.”
In response, Dare-Johnson co-founded Healthtracka in 2021, with funding from Silicon Valley. The platform provides home health tests, online consultations with doctors, and an app for users to track their health readings.
Healthtracka is just one example of the booming start-up scene in Nigeria that has attracted venture funding from around the world. Investors are hopeful that success in Nigeria’s large national market will pave the way for expansion across the entire continent.
According to Benjamin Dada, publisher of local tech media publication Bendada.com, venture capital funding in Nigeria has surged from an estimated $50 million in 2015 to nearly $1 billion in 2022. However, this year, funding has slowed due to a global economic downturn.
Nonetheless, the optimism surrounding start-ups like Healthtracka remains strong as digital platforms allow for rapid scaling that was unimaginable a decade ago. Sectors such as healthtech, fintech, agritech, renewable energy, logistics, and education have seen significant investments.
One of the attractions of Nigeria’s tech scene is the ability to make a substantial impact with relatively small investments. Despite having seed capital of just $1.2 million, Healthtracka has delivered 20,000 tests to 5,000 users across 14 Nigerian states since its inception.
Kola Aina, founding partner at Ventures Platform, a fund with a pan-African portfolio of 80 companies, believes that Nigeria has produced at least seven unicorns (start-ups valued at over $1 billion) in recent years. These unicorns are now a vital part of the national economy.
While international venture capital has played a significant role in driving African start-ups’ growth, Aina emphasizes the importance of local capital. “We are seeing the rise of local capital. We think that merely having international capital without local capital can be problematic,” he says.
Larger funding rounds are becoming more common as well. Husk Power Systems, a US clean energy company, aims to raise $100 million in its current funding round to set up solar power installations in Nigeria and other Sub-Saharan African countries.
Other start-ups, like DrugStoc, focus on improving the social fabric. DrugStoc raised $4.4 million in 2021 to combat the issue of fake medicines in Nigeria. By establishing direct links with drug manufacturers and healthcare facilities, DrugStoc eliminates middlemen who profit from selling counterfeit drugs.
Chibuzo Opara, co-founder of DrugStoc, believes that technology in Africa is becoming more Afro-centric and less reliant on replicating Western models. These innovations have matured, and growth models have become more homegrown.
The Nigerian start-up scene continues to thrive, with promising opportunities for both local and international investors. As the ecosystem evolves, the potential for impact and profitability grows.
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