Universities have to contribute more to startup ecosystem
This emerged from a publication titled the Nigerian Startup Ecosystem Report 2022 published by Disrupt Research in September.
The report presents local ecosystems through analysing active startups, local support networks and funding over the past seven-and-a-half years.
It is the third country-focused publication after the October 2021 Egyptian Startup Ecosystem Report and the July 2022 South African Startup Ecosystem Report.
As of September 2022, the report finds that at least 481 tech startups were in operation across Nigeria, employing over 19,000 people with fintech being the most populated sector, representing more than one-third of the total active tech startups.
Almost 50% of Nigerian tech startups have undergone some form of acceleration or incubation, though diversity is an issue as less than 15.6% have a female co-founder.
Nigerian startups are supported by a strong investment ecosystem with total investment increasing more than fourfold between 2020 and 2021, and are on course for a further big leap in 2022.
At least 383 individual Nigerian tech startups raised a combined US$2,068,709,445 in funding between January 2015 and August 2022, more than any other country in that period.
The report stated that a large number of leading Nigerian universities run entrepreneurship-focused courses, and have established entrepreneurship and innovation centres, according to the report.
Those include the universities of Ibadan, Obafemi Awolowo, Nigeria, Lagos, Port Harcourt, as well as Covenant and Pan-Atlantic universities and the Federal University of Technology Akure. Nigeria’s most successful business founders have disproportionately studied at these institutions, according to the report.
This is in line with an October 2020 report, West African Startup Decade Report published by Techpoint Africa, which indicated that some Nigerian universities are making progress in the development of innovative and entrepreneurial mindsets.
“The Nigerian Student Venture Prize, founded in 2019, works to promote and showcase unique business ideas and entrepreneurship among university students, as well as to help eliminate the gap between the academic world and the business community,” the report highlighted.
Low entrepreneurship activities
The report stated: “It is not just in terms of government and corporate engagement that Nigerian startups lack the support of their peers in markets like Egypt and South Africa. When it comes to entrepreneurship support from Nigerian universities, levels of activity are also relatively low.”
“This low level of activity contrasts with the likes of the American University in Cairo in Egypt, or the University of Cape Town and Stellenbosch University in South Africa, all of which have dedicated in-house incubators or accelerators for student-founded external startups. Some of those, and others, are also investing in – and taking equity stakes in – startups via their tech transfer offices,” the report pointed out.
“This level of involvement is sadly lacking in Nigeria and, as with the government and corporate tiers, more needs to be done if the ecosystem as a whole is to produce the quality of ventures that justifies the amount of capital coming into it,” the report concluded.
Dr Stephen Oluwatobi, founder and board chair of the Hebron Startup Lab at Covenant University in Nigeria, told University World News: “I believe there are three categorical skills that universities must ensure their students master before they graduate from school, including technical skills (economics, engineering, and all they offer as degrees); life skills (leadership, negotiation, communication, attitude to work, resilience, etc); and entrepreneurial skills (which enable students to see problems as opportunities to create prosperity, instead of another thing to complain about).”
“Nigeria desperately needs graduates with entrepreneurial skills to create prosperity from its problems. But, if the universities can’t see that, they would only be adding to the number of unemployed graduates, who only have ‘light-weight’ technical skills, but lack the life and entrepreneurial skills to pull through in the world,” said Oluwatobi, who is also co-founder of Quanta Africa-Innovative Tech Social Enterprise Innovations.
“Thus, for enhancing the role of Nigerian universities in establishing an efficient and innovative startup ecosystem, first, the universities and their leaders need to be the students. They need to learn how to ‘create’ 21st-century graduates who will be relevant in the current digital and entrepreneurial age. If they can’t get this, they will still be producing graduates for a world that no longer exists,” Oluwatobi added.
“A number of Nigerian universities are striving and trying to develop an innovative and entrepreneurial mindset through strategic moves; but not many are getting it (right),” he said.
“Nigerian Universities must also work towards driving strong university-industry relationships,” Oluwatobi suggested.
“This exposes the educators and students to present-day problems that would challenge their entrepreneurial minds instead of the ‘stale textbooks’,” he explained.
“Such relationships should also give faculty members opportunities to intern and have their sabbaticals in the industry where the real problems are.
“When they return to the classroom, they would be challenging their students to engage their entrepreneurial minds as well as raising better students.
“It takes a king to raise another king; a slave cannot make a king. Teachers and lecturers need the entrepreneurial mindset to help students develop theirs,” Oluwatobi emphasised.
“My experience directing the Centre for Entrepreneurial Development Studies at Covenant University also revealed the importance of having entrepreneurs facilitate entrepreneurial classes instead of read-to-teach teachers,” Oluwatobi pointed out.
“We also leveraged our alumni network of entrepreneurs a lot, who helped to facilitate entrepreneurship classes and mentor aspiring entrepreneurs. Part of the mentoring process involved interning directly with the entrepreneurs and founders during their long holidays,” he noted.
“I founded the Hebron Startup Lab in 2016 to enable Covenant University students to express and exercise their entrepreneurial muscles and capacities as well as provide support to take their validated ideas from concept to product, to market,” Oluwatobi explained.
Over the years, a lot of viable companies have been started by Covenant University graduates, from Softcom to PiggyVest to Korapay to Earnipay to ThriveAgric, to mention a few, he said.
Indicators for measuring university success
Oluwatobi said Nigerian universities should rethink how they measure their success: whether it should be based on the number of students they graduate (who cannot secure jobs) or whether it is based on the number of first-class students (who still struggle in life)?
According to him, Nigerian university success should be based on the extent to which their graduates are being sought out for employment and how many of their graduates are launching high-growth startups that solve problems, offer jobs and create wealth.
“Nigerian university success should also be about the percentage of the contribution of their graduates to the overall gross domestic product, or GDP – the total monetary or market value of all the finished goods and services produced within a country’s borders in a specific time period,” Oluwatobi added.
“If Nigerian universities cannot see the real indicators for success and if they cannot see beyond the graduation, then, they are not only void of entrepreneurship, but they have failed,” Oluwatobi concluded.
Oluwatobi is the lead author of a 2019 study titled, ‘Entrepreneurial Ecosystem Matrix (EEM): A proposed framework for Nigerian universities to become factories for startup companies’, which stated that “universities can frequently churn out start-up companies by setting up platforms to create value from knowledge (ideas, concepts, prototypes and products) developed by the university community; validate that the value created is an efficient, effective and applicable solution; develop the entrepreneurial mindedness of the university community; and establish an enabling environment, defined by the incentives, institutional quality, infrastructure, capital, access to markets, workspace, laboratories for experimentation, technology transfer offices, as well as industry support and linkages”.