IrokoTV founder, Jason Njoku, has shared the story of IrokoTV’s turbulent journey in recent years, but holding on to resilience and a triumphant comeback notwithstanding.
Speaking about the challenges the independent SVOD (Subscription Video on Demand) platform faces, the founder of IrokoTV revealed the struggles, setbacks, and determination that have characterised the company’s fight for survival in the competitive streaming industry.
The journey began in 2019 when IrokoTV faced a critical decision: to continue the struggle or exit the market. Despite the option to close the company and distribute remaining cash to shareholders, Njoku chose to reinvest in IrokoTV, pouring a significant portion of personal funds into the venture to pursue the vision of building a massive, independently black-owned SVOD service.
“Anyhow, when Iroko exited ROK in 2019, I had the opportunity to exit too, and at the time, even Bastian asked if it made sense to continue struggling away. After all, wasn’t it always about liquidity? I could close IrokoTV down, distribute the remaining cash to shareholders and walk out into early semi-retirement. The story could have ended there. Maybe it was a mid-life crisis (I was 39 then). For some strange reason, I still felt I had plenty of fight left. I knew what I knew, and I knew who we wanted to become.
“Ultimately, to soften things, the board approved $5m in special dividends for shareholders, and the remaining capital went all in SVOD again. To go again, to build the big vision I had all those years ago – a massive, independently black-owned SVOD service. I used 70% of my cash windfall to reinvest in Iroko. I didn’t want cash. I wanted increased equity – which I bought from an exiting investor – and to go again. This was September 2019. By March 2020, COVID-19 happened, and the Nigerian maco-challenges, always lurking, exploded. Our international business boomed. Our local business evaporated. Our cost basis was wholly unsustainable. The subsequent Naira devaluations rendered our entire investment and business planning for Nigeria in shambles. But this isn’t news.”
The road ahead was far from smooth, with the emergence of COVID-19 in 2020 and the challenges in the Nigerian market posing significant hurdles. Between 2015 and 2020, IrokoTV invested $30 million in Nigeria, facing losses and devaluations that threatened the company’s stability. Despite these difficulties, Njoku persisted, implementing cost reductions, exiting leases, and refocusing efforts on survival.
The struggle for sustainability could have led to tough decisions, including layoffs and changes in the company’s culture, but it remained steadfast. Njoku emphasized the importance of responsible financial management in startups, highlighting the burden of burning money without a clear path to profitability.
One of the significant shifts in strategy was the decision to prioritise international markets over local ones. With a focus on North America and Western Europe, IrokoTV navigated challenges and successfully reduced losses from -$4.9 million in 2020 to an expected -$0.5 million in 2023. To support sustainability, IrokoTV increased prices, aligning with global trends in the streaming industry.
Addressing recent controversies surrounding IrokoTV, Njoku clarified misunderstandings and emphasized the importance of accuracy in media reporting. He acknowledged the challenges of maintaining an independent SVOD platform, especially in the face of rising content costs.
He further pointed to the need for prioritisation of startups and their ability to scale in challenges, Njoku said: “With what I am going through, although I would prefer to complete the turnaround more privately, I think it’s essential that the wider community get a sense of what happens in startups. It’s not pretty; the culture will change, no matter how much you attempt to retain the culture; as the team moves to pure sustainable output focus, it changes.”
As IrokoTV approaches its 12th anniversary on December 1st, Njoku is confident that the company will keep thriving, not giving in to setbacks, but sustainability of the company’s future, showcasing resilience in the face of adversity.
