IN 2015, Seedstars World, a major startup competition active in dozens of emerging markets, made Lagos its headquarters. The firm based the decision on the number of startup deals happening and promising ideas in Africa’s most populous nation at that time.
“The feeling among investors and many in the tech scene seems to be that Nigeria is on the cusp of a revolution,” said the Business Year in 2015.
Ten years after, the bounce appears to have turned to bust, with several startups freezing after receiving big funding from private equity and venture capital firms.
Pivo founders, Ijeoma Akwiku and Nkiru Amadai-Emima
When Pivo started in 2021, it was all excitement. The startup, founded by Ijeoma Akwiku and Nkiru Amadai-Emima, provided financial services to small businesses in Africa. Pivo raised $2.6 million from Y Combinator, Ventures Platform, Mercy Corp Ventures, and over 15 other investors. Pivo had earlier raised a $100,000 pre-seed round from Microtraction, FirstCheck Africa, and Rally Cap Ventures two months after its launch.
Ms Amadi-Emina and Ms Akwiwu were experienced in the logistics sector before founding Pivo, and they had no competition in the supply chain sector at that time. So, investors were excited. In 2023, however, the startup shut down to the chagrin of market watchers.
READ ALSO: Paul Onwuanibe: Billionaire at the centre of N42bn Landmark Beach demolition
Similarly, Hytch, a Nigerian logistics startup, began operations in 2021. Nine months after, it shut down operations, blaming lack of funds. “It’s been a tough one but we are shutting down operations finally. We would no longer be providing our services to businesses or individuals. We appreciate all our customers and well wishers!” the company said in an announcement.”
Also, Kippapay, a fintech startup launched in 2022 by Mr Kennedy Ekezie, was created as an offline agency banking firm. Due to its brilliant idea, it succeeded in raising $8.4 million in funding. In November 2023, Kiddapay shut down. TechCabal cited naira devaluation and macroeconomic challenges as key reasons for the shutdown.
Bundle Africa founder, Yele Babamosi
Bundle Africa, a social payments app for cash and cryptocurrency, was set up in 2021 by Mr Yele Bademosi. It allowed users to trade cryptocurrencies and save in multiple currencies. The firm raised $450,000 in seed funding. In 2021, Bundle expanded its operations to Ghana and had over $50 million in monthly transactions, according to Startup Graveyard. However, it closed operations after three years of operation, focusing rather on its peer-to-peer platform called Cashlink.
Okada founder, Mr Okechukwu Ofili
Once upon a time, Okada was a digital bookshop and publication platform of choice. Founded by Mr Okechukwu Ofili in 2013, the startup boosted the self-publication of authors from sub-Saharan Africa, taking a 30 percent commission from published authors.
After raising a total of $1.2 million in funding, it announced shutdown in November 2023, citing a lack of funding and harsh macroeconomic conditions.
Lidya cofounders, Tunde kehinde and Ercin Eksin
54gene, an African genomics research, was founded in July 2023. It raised $45 million in seed funding to expand operations across Africa. Soon after, the startup changed CEOs after CEOs, resulting in a chaos. “Unfortunately, the company could not continue to operate financially, and it began to wind down in July,” its CEO at that time, Mr Ron Chiarello, told TechCabal.
READ ALSO: Revealed: Why EFCC is probing Kyari, top ex-NNPC officials
Furthermore, Okra, the Nigerian fintech that pioneered open banking in Africa, shut down operations in May 2025, returning millions to investors. It had raised $16.5 million from investors. Its CEO, Ms Fara Ashiru, later joined the United Kingdon-based Kernel as head of engineering.
In October 2025, Nigerian digital lender, Lydia, shut down operations nearly a decade after launch. It was founded by Jumia alumni Mr Tunde Kehinde and Mr Ercin Eksin, offering micro, small and medium businesses with access to fast, collateral-free loans through its digital platform.
It ended operations by sending an email to customers, noting that despite best efforts to restructure and sustain operations, “the company has encountered severe financial distress and is no longer able to continue in business.”
Why shutdowns persist
An article that appeared on medium.com identifies governance, risk and compliance issues as key reasons for the failure.
‘Build strong boards and clear policies to guide how money, people, and decisions are managed. Always prepare for the unexpected, whether it is economic swings, market changes, or investor withdrawals. Stay updated with evolving regulations, especially in fintech and health sectors,” the article noted.
Startup founder, Mr Charles Udofia, noted that the major cause of the shutdowns is an overestimation of the Nigerian market. He said several entrepreneurs often took a number of things said about the Nigerian and even African market hook, line and sinker without doing due diligence and proper investigation.
“You have to do a lot of market research to understand the Nigerian and even African market,” he said. “This is seriously lacking among startup founders in this part of the world. The Nigerian market, and even African market, is huge, but the purchasing power of consumers is low. Government policies are poor, and the market is still evolving. So, don’t exaggerate the market potential here,” he added.
For a business advisor, Ms Bunmi Ayoola, the business model might just be the problem. “We have poor business models in this part of the world and often do not plan long term. Once we have the first buzz, we believe we begin expansion without waiting to consider whether it is yet the right time,” she noted.
