Lagos’ tech valuations surge 12

Lagos has emerged as Africa’s leading rising star technology ecosystem, with the city’s startup valuations increasing nearly 12-fold since 2017, as U.S. investors increasingly become the dominant source of external capital flowing into Nigeria’s technology sector.

Brandon Hudspeth, U.S. consul general in Lagos, disclosed this on Wednesday at the GITEX Nigeria Startup Festival, where he said U.S.-sourced funding accounted for an estimated 60 percent of all venture capital entering Nigeria between 2015 and 2025.

His remarks highlight the growing strategic importance of American capital, technology infrastructure and talent development to Nigeria’s startup economy, even as founders face a more difficult global funding environment.

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According to Hudspeth, Lagos ranked number one on Dealroom’s 2025 Global Tech Ecosystem Index “Rising Stars” list, ahead of technology centres including Istanbul, Mumbai and São Paulo.

The city’s position reflects what he described as a dramatic expansion in the value and depth of its technology ecosystem over the past decade.

“Lagos is the best place in Africa to demonstrate the U.S. partnership in tech,” Hudspeth said.

He pointed to the nearly 12-fold increase in Lagos’ ecosystem valuation since 2017 and the city’s ability to produce six of Africa’s 10 unicorns as evidence of the scale of the transformation.

Lagos now has more than 3,300 startups, while the technology industry accounts for more than 16 percent of Nigeria’s overall gross domestic product, according to figures cited by the U.S. Consul General.

The most significant element of the U.S. government’s assessment is the scale of American capital behind Nigeria’s technology expansion.

Hudspeth said U.S.-based investors were consistently the largest source of external capital for Nigeria’s technology ecosystem over the 10 years to 2025. “U.S.-sourced funding accounts for an estimated 60 percent of all venture capital entering Nigeria,” he said.

The funding is not coming solely from traditional venture capital firms. Hudspeth identified major American technology and financial companies including Visa, Google, Mastercard, Microsoft, Uber and PayPal as participants in Nigeria’s technology ecosystem, alongside smaller U.S. venture capital firms and philanthropic organisations.

The Gates Foundation and the Chan Zuckerberg Initiative are also expected to play an increasing role, he said.

The concentration of U.S. capital gives American investors an unusually large influence over the direction of Nigeria’s startup ecosystem, from payments and financial services to mobility, enterprise software, cloud computing and artificial intelligence.

For Nigerian founders, the relationship is increasingly extending beyond equity financing.

Hudspeth said U.S. companies were providing training, infrastructure, connectivity and platforms that allow Nigerian startups to develop and reach customers outside the country.

The U.S. involvement in Nigeria’s digital economy is also becoming more infrastructure-driven. Google and Meta have invested in subsea cable infrastructure serving Nigeria, while companies including Equinix and Digital Realty are connecting Nigerian data infrastructure to global networks.

Amazon Web Services, Starlink and other U.S.-linked technology companies are also contributing to the digital infrastructure on which startups depend.

Hudspeth said these investments were creating the foundation Nigerian companies need to connect with international customers and scale beyond the domestic market.

That infrastructure layer could become increasingly important as Nigerian startups seek to build artificial intelligence, fintech, healthtech and enterprise platforms that require reliable access to cloud computing, data centres and high-speed connectivity.

Capital and infrastructure are only part of the U.S.-Nigeria technology relationship. American companies are also investing heavily in Nigeria’s technology workforce.

Hudspeth said Google, Cisco, Meta and Microsoft were training hundreds of thousands of Nigerians in technology and artificial intelligence.

The development addresses one of the central constraints facing Nigeria’s technology ambitions: the ability of startups and established companies to find enough skilled workers to support rapid expansion.

For the U.S., however, the relationship also provides access to one of Africa’s largest pools of young technology talent.

The combination of Nigerian talent, American capital and global technology infrastructure is creating what Hudspeth described as a partnership capable of generating economic benefits on both sides of the Atlantic.

The rapid expansion of Lagos’ technology ecosystem has already produced six of Africa’s 10 unicorns, according to the U.S. Consul General.

The challenge now is whether the ecosystem can reproduce that success at scale. Nigeria’s technology startups have attracted substantial international attention, but access to capital remains a critical constraint. The global venture market has become more selective, forcing founders to demonstrate stronger revenues, clearer paths to profitability and more defensible business models.

Against that backdrop, the continued participation of U.S. investors could determine which Nigerian startups are able to survive the funding cycle and emerge as globally competitive companies.

Hudspeth suggested that the next generation of Nigerian unicorns could already be represented among founders attending GITEX Nigeria. “Just maybe the next six unicorns will be developed by the talent that is in this room today,” he added.

The growing technology relationship is also being supported at the government level through the U.S.-Nigeria Commercial and Investment Partnership.

Hudspeth said the U.S. Consulate was working to bring entrepreneurs, investors, business leaders and policymakers together to address regulatory and commercial bottlenecks that restrict trade and investment.

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The objective is to increase predictability for businesses, unlock deals and create conditions for companies on both sides of the Atlantic to expand, he posited.

For Lagos, the implications extend beyond its status as Nigeria’s startup capital.

A 12-fold increase in ecosystem valuation since 2017, thousands of startups, six unicorns and a technology sector contributing more than 16 percent of GDP have transformed the city into a strategic technology market for global investors. But the growing dependence on U.S. capital also means that the trajectory of Nigeria’s startup ecosystem will remain closely tied to international investment appetite.

Royal Ibeh is a senior journalist with years of experience reporting on Nigeria’s technology and health sectors. She currently covers the Technology and Health beats for BusinessDay newspaper, where she writes in-depth stories on digital innovation, telecom infrastructure, healthcare systems, and public health policies.

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