The Chief Executive Officer of Mainstack, Ayobami Oyaleke, has urged investors and startup founders in Nigeria to prioritise revenue generation, customer retention and business sustainability over the amount of funding raised.
Oyaleke said the success of Nigeria’s startup ecosystem should be measured by how well businesses attract paying customers, generate consistent income and manage operational risks rather than the size of their investment deals.
Speaking on the state of startup financing, he noted that raising substantial capital does not automatically translate into a successful business.
He stressed that founders must demonstrate that their products meet genuine market needs and have the potential to generate sustainable returns.
According to The Guardian, Oyaleke’s comments come amid changing investment trends across Africa.
Partech’s 2025 report showed that African technology companies raised $4.1 billion, a 25 per cent increase from the previous year.
However, Nigerian startups recorded a 21 per cent decline in equity funding to $412 million across 83 deals.
He said investors should look beyond registration numbers and transaction volumes when assessing startups, focusing instead on paying customers, repeat purchases, revenue performance and the cost of serving customers.
Oyaleke also cautioned founders against excessive borrowing, explaining that debt financing could create financial pressure when businesses lack predictable revenue to meet repayment obligations.
He added that investors should improve access to early-stage funding by making investment processes more transparent, providing feedback to unsuccessful applicants and supporting businesses before they reach significant scale.
He further identified regulatory uncertainty, compliance costs and cross-border transaction challenges as issues that need attention to improve Nigeria’s startup environment.
Oyaleke maintained that Nigeria’s startup ecosystem needs a funding approach that rewards businesses capable of turning investment into lasting economic value.
Source: The Guardian | BusinessPress
