$1trn Economy Depends on Growing Small Businesses, Oyedele Says
…Nine Startups Win Prizes at NSIA Innovation Contest
By Patience Ikpeme
The Federal Government says Nigeria’s plan to build a $1 trillion economy will depend largely on how well the country can turn small businesses into big companies that create jobs, attract investment and compete in world markets.
The Minister of Finance and Coordinating Minister of the Economy, Mr Taiwo Oyedele, said this at the fourth edition of the Nigeria Sovereign Investment Authority (NSIA) Prize for Innovation in Abuja on Saturday. He was represented by his Special Adviser on Investments, Marie Ukpere.
“Our mission to build a trillion-dollar economy will depend in no small measure on our ability to help small businesses become medium-sized enterprises, medium-sized enterprises become large companies and Nigerian companies become competitive players across Africa and the world,” the Minister said.
He described small and medium-sized enterprises (SMEs) as the backbone of the economy because they keep millions of people employed and support activity in many sectors. He said roads, factories and a stable government budget remain important priorities, but the real strength of the economy lies in businesses that make goods, provide services and employ people.
The Minister said many promising businesses fail to grow because they cannot get money, skills and support. He listed several government efforts to fix this. They include the Development Bank of Nigeria, the National Credit Guarantee Company, which is meant to make banks less afraid to lend to small businesses and manufacturers, and the Nigerian Consumer Credit Corporation, which is working to widen access to responsible credit so that more people can afford to buy goods. He also mentioned a $618 million programme to give technology and creative businesses access to finance, skills and support.
Mr Oyedele said the NSIA helped set up the Development Bank and the credit guarantee company. He added that it is now backing venture capital funds to bring more investor money into promising Nigerian firms. He also said the NSIA is preparing an impact innovation fund with the Japan International Cooperation Agency (JICA), and that British International Investment has shown interest in joining.
He said entrepreneurs often need more than bank loans. They also need patient capital, experienced investors and useful business contacts, especially when entering new markets. He said young Nigerians in particular should be helped to build businesses instead of waiting for jobs. “The real measure of your success will not be the prize you receive today. It will be the businesses you go on to do afterwards,” he told the finalists.
At the event, the NSIA announced the winners of the competition. Twelve finalists, chosen from 6,000 applications, pitched their ideas to a panel of experts drawn from business, investment and innovation circles. This year’s contest focused on manufacturing, climate and food security, and healthcare.
The total prize value was $275,000. The NSIA provided $220,000, Cascador provided $45,000 and Wema Bank provided $10,000.
Come Again Foods, a company that makes packaged snacks from locally grown farm produce, won the overall prize of $100,000. Protein Kapital came second with $70,000. The company makes protein and fertiliser from insect farming and the processing of organic waste. Instant Rad Inc., which uses artificial intelligence to link hospitals and diagnostic centres with radiologists across Africa, came third with $50,000.
Other awards followed. Cascador gave $15,000 each to Eight Medical and Uwana Energy. Cascador also gave $5,000 each to Sambal Enterprises, Come Again Foods and Ebees Green. Wema Bank gave $4,000 each to Eight Medical, Smartel Agri Tech and Tryctor.
The Managing Director and Chief Executive Officer of the NSIA, Aminu Umar-Sadiq, said the help goes beyond prize money. He put the equity support at about $350,000. He said the top 200 applicants were first put through accelerator programmes before the field was cut to 12, and that the 12 will now attend a six-week learning programme at Lagos Business School. He described the approach as “education, equity, and exposure”.
Eligible winners can also apply for up to $1.5 million in growth capital through the Pula Xcelerator, according to the NSIA. They will join a fully paid training programme in Lagos covering business strategy, leadership, governance, financial management and how to prepare for investors.
Mr Umar-Sadiq said small businesses are central to the NSIA’s strategy, alongside its investments in infrastructure. “Without SMEs, you have no job creation. Without SMEs, you are unable to actually grow economically,” he said. He said the authority has also backed small businesses through the Fund for Agricultural Finance in Nigeria and the Development Bank of Nigeria.
He said the NSIA keeps working with companies after investing, helping their management teams improve governance and build demand for their products. “This is really the beginning of the journey,” he said. He added that such support could one day produce unicorns, meaning companies worth $1 billion or more. He named Money Africa and Sycamore as earlier beneficiaries that are still doing well. He cautioned that the programme should not be judged on results from one or two years, saying a period of about five years is needed to see whether a business has truly grown.
The National Coordinator of the Presidential Initiative for Unlocking the Healthcare Value Chain, Dr Abdu Mukhtar, said Nigeria’s health sector offers big opportunities for entrepreneurs and investors. He put the market at about $20 billion and said, citing International Finance Corporation figures, that about 250,000 SMEs already operate in the sector. He said opportunities go beyond hospitals to drugs, clinical research, medical devices, telemedicine, digital health and the movement of medical supplies.
He urged entrepreneurs to build businesses that make profit while improving access to affordable care. He said success should also be measured by lives saved, diseases prevented, fewer maternal deaths, and children lifted out of malnutrition.
The lead judge, Affiong Williams, founder and Chief Executive Officer of the dried-fruit company ReelFruit, told the finalists to build around what customers want and are willing to pay for, instead of relying on how new a product is. She said it is easier to sell what people already want than to create a product and then struggle to convince buyers.
Drawing on 14 years in business, she said she has raised more than $7 million from individuals and institutions. She credited preparation, resilience, a strong record and good relationships. She advised the finalists to prepare for pressures such as currency swings and policy changes, and to build networks of investors, advisers and business leaders. She said she was turned down several times when she sought support but kept going until she succeeded, and she urged the finalists not to see this contest as their only chance.
The NSIA said the first three editions of the prize drew more than 20,000 applications from across the six geopolitical zones.
