In Africa’s tech ecosystem, insiders have always toyed with one question: what happens when players outside traditional venture capital (VC) and private equity (PE) firms step into the business of backing tech startups? Or more broadly, what happens when organisations that have never been central to the venture ecosystem suddenly take a visible interest in it?
It now seems the Nigerian government is testing both theories. After stepping into its new role as a limited partner (LP) by investing in Ventures Platform’s $64 million Fund II through the Investment in Digital and Creative Enterprises (iDICE) programme, it appears ready to evolve again.
This time, it wants to act as something closer to an ecosystem builder. It has opened applications for a ₦50 million ($35,000) equity-free student venture capital grant. Young founders will also gain access to mentorship and a one-year Gemini Pro licence. It is an unusual move precisely because the capital is coming from a source the ecosystem has rarely seen operating at this stage.
Last Thursday at Ventures Platform’s Prosperity Summit, panellists talked about a persistent frustration. Participation from non-traditional players, including conglomerates, telecom firms, and large institutions, is improving but still painfully slow. Buyers are slow, too. Everyone agrees the ecosystem needs more people at the table, but the rate of institutional involvement has not caught up with the ambition.
Two trends did stand out at the event. Development finance institutions (DFIs) are steadily backing African funds, and successful founders are returning to invest in ventures. Corporates and banks are warming up as well. Standard Bank, for example, has invested in 16 funds across PE and venture capital, according to a director, most recently backing Planet42, the South African car subscription startup, with $16 million in 2024.
The student grant pushes this idea further by introducing capital from a source the ecosystem is not accustomed to seeing on the frontline. It makes us wonder: how big should iDICE’s ambitions be for campus-born ventures, and is there room for true returns? Or should expectations be tempered? Incentives matter.
For the government, the incentive may be less about immediate yield and more about nurturing the next generation of tech builders. While this is a commendable plan, execution and benchmark-setting for innovation will be key.
