Nigeria's Startup Act: Three Years of Progress and Challenges

Three years after President Muhammadu Buhari signed the Nigeria Startup Act into law in October 2022, the groundbreaking legislation continues to reshape Africa's largest tech ecosystem. In its most recent development, the National Information Technology Development Agency (NITDA) announced on October 6, 2025, the appointment of four startup ecosystem representatives to the National Council for Digital Innovation and Entrepreneurship (NCDIE), marking a significant step toward operationalizing the Act's promise of giving founders a direct voice in policymaking.

New Leadership for Digital Innovation

According to TechCabal, NITDA, through its Office for Nigerian Digital Innovation (ONDI), elected four representatives through the Startup Consultative Forum (SCF) to serve two-year terms on the Council: Iyinoluwa Aboyeji (Founding Partner at Future Africa and co-founder of Andela and Flutterwave), Victoria Manya (Co-Founder and Executive Director of Advocacy for Policy and Innovation), Charles Uchenna Emembolu (Founder of TechQuest), and Abba Ibrahim Gamawa (Founder of Go Agent Limited).

Nairametrics reports that these representatives will make inputs and proposals to the NCDIE, ensuring that the objectives of the Nigeria Startup Act are effectively implemented through well-aligned policy guidelines and monitoring.

Co-Created Legislation

The Nigeria Startup Act represents an unprecedented collaboration between government and the tech ecosystem. According to the official Startup Bill website, over 30 leaders in Nigeria's tech ecosystem contributed to its drafting between June and September 2021, a level of consultation almost unprecedented in Nigeria's legislative process.

Three Years of Progress

O. Kayode & Co reports that by April 2024, data from the National Bureau of Business Growth showed a 25 percent increase in new business registrations since the Act's implementation, particularly in tech, health, and green industries.

The Startup Portal reported 12,948 startups registered for labeling by April 2024, alongside 912 venture capitalists, 1,735 angel investors, and 925 accelerators, incubators, and hubs onboarded under the Act. According to ONDI, 75 startups had been labeled as of May 2025.

The tax incentives offered to investors have proven effective. According to recent reports, early-stage funding for startups increased by 30 percent, and the success rate of these startups has risen due to better funding access.

Critical Institutions Established

The Act established several key institutions reshaping Nigeria's innovation landscape:

National Council for Digital Innovation and Entrepreneurship: Chaired by the President with the Vice President as Vice Chairman, the Council includes the Minister of Communications and Digital Economy, the Governor of the Central Bank of Nigeria, and the Director-General of NITDA as Secretary, alongside four SCF-elected startup representatives.

Startup Portal: TechQuest reports that this e-platform serves as the central hub for registration, collaboration, and resource sharing, enhancing visibility and connectivity in the startup ecosystem.

Startup Investment Seed Fund: A dedicated public fund supporting early-stage capital, directly addressing capital access bottlenecks that have historically constrained African startups.

Expanded Institutional Commitments

Technext24 reports that in November 2023, the Startup Support and Engagement Portal was opened, and by mid-2024, the Labeling Committee had begun its work. State institutions expanded their commitments: the iHatch Cohort 4 programme set out to support 185 startups and 37 innovation hubs, while the Tertiary Education Trust Fund announced plans for 48 innovation centres nationwide, with 12 already operational, 18 in final procurement stages, and another 18 expected by 2025.

Persistent Challenges

Despite achievements, significant challenges remain. ONDI announced it is addressing the funding gap for Nigerian startups through the establishment of a $40 million fund, acknowledging that access to capital remains a critical barrier.

Between 2023 and 2025, at least 15 Nigerian startups shut down after raising more than $100 million in total, with names like Okra ($16.5 million), 54gene ($45 million), and Vibra ($6 million) fading from the ecosystem. Public exits remain rare, with African startups recording just 22 exits in 2024, only a modest uptick from 20 in 2023.

Notable Success Stories

Greenify, a startup revolutionizing urban gardening with smart irrigation systems that conserve water and reduce waste, received early funding through the Act and has quickly grown into a recognized name in sustainable tech, demonstrating the Act's potential to support innovative solutions.

Voices from the Ecosystem

Ecosystem leaders have expressed both optimism and caution. Oluwatomi Solanke, CEO of Trove Finance, stated on the eve of the Act's passage: "Nigeria has one of the most vibrant tech ecosystems in the world. However, the Nigerian tech ecosystem pales in comparison to other ecosystems in developed markets due to several reasons, one being Government policies. Startup Act will birth many more tech startups in Nigeria."

Tunji Andrews, CEO of Awabah, argued during a webinar that the focus should be on ensuring "the conveyor belt of talents" continues producing innovators, rather than worrying about brain drain.

Looking Ahead

The appointments of Aboyeji, Manya, Emembolu, and Gamawa to the NCDIE signal that Nigeria is beginning to operationalize the Act's key promise of ecosystem representation in policymaking. The Council is expected to guide the rollout of startup labeling, investment incentives, capacity-building programmes, and regulatory reforms envisioned by the Act.

As Technext24 concludes, three years on, the Startup Act has clearly brought structure, visibility, and momentum to Nigeria's tech space, anchoring it with verifiable figures and new institutional commitments. The question remains whether it has truly shifted the ecosystem from legislation on paper to thriving tech hubs on the ground. The answer, for now, is mixed but showing promise.