But they cannot act in isolation. Government, donors and the private sector need to move as one if resilience is to take root in Nigeria.

In late May 2025, flooding in Mokwa in Niger State killed at least 117 people and left several still missing. Earlier, heavy rains destroyed homes and claimed at least 21 lives in north-central Nigeria. 

On August 6, the federal government issued flood alerts for 19 states, warning of further extreme rainfall between August 5-9. 

These events show a pattern of high climate risk: poor drainage, urbanisation, infrastructure vulnerability and changing rainfall patterns all combine to raise the stakes for agriculture, food security and human lives.

Why this is important – the drivers

• Scale of the hazard. Floods are not occasional. The Mokwa event was one of the deadliest in recent years. Lives and livelihoods are being wiped out.
• Underlying drivers. Rapid urban growth, informal settlements without drainage, old dams or reservoir‐releases (the latter implicated in past flood alerts) and infrastructure that wasn’t built with climate resilience in mind. 
• Financial gap. According to the latest report by Climate Policy Initiative, Nigeria mobilised about $2.5 billion in climate finance in 2021/22, up from $1.9 billion in 2019/20, but the annual gap (the amount needed vs the amount mobilised) is around $27.2 billion. 
• Data & systems weakness. There are limited hydrological sensors, weak last-mile alerting, and procurement systems that favour large infrastructure over agile tech-solutions.

What startups can build (and why)

Here are four areas of opportunity where startups can move from idea to impact.

1. AgTech for small-holder resilience

Startups can deliver climate-smart advisory (micro‐weather + seasonal forecasts), flood/drought-tolerant seed systems, bundled micro-insurance linked to weather triggers, and credit for replanting after floods. 

The reason: agriculture is highly exposed; floods destroy farmland and disrupt planting cycles. A viable business model could be subscription advisory plus revenue share on inputs and insurance commissions.

2. Urban resilience & data-driven infrastructure

A startup might build flood-risk mapping using satellite & local sensors, dashboards for municipalities or utilities, plus partnering with local contractors for nature-based drainage solutions. 

Drainage failures, particularly in fast-growing urban zones, magnify losses. Monetisation may come via B2G contracts (municipalities), and SaaS for decision-makers.

3. Disaster early-warning & last-mile alerting

Existing forecast agencies (e.g., the Nigeria Meteorological Agency and Nigeria Hydrological Services Agency) generate data. The gap is last-mile: reaching communities with actionable alerts, setting up evacuation triggers, and automating cash transfers tied to events. 

Startups can provide alert platforms, community-volunteer networks, and cash-trigger logic. Revenue comes from contracts with federal/state agencies or donors financing early‐warning programmes.

4. Data & risk-finance platforms

Startups can build APIs that feed river/dam sensor data, flood-indexes for insurers, and platforms that match resilience projects with blended finance. 

This matters because insurers, lenders and investors require data and pipelines to underwrite risk and invest in adaptation. Business models: licensing data/APIs, performance-based contracts, or match-making fees.

Real barriers—for clarity

I don’t want to sugar-coat it. To succeed, startups must navigate tough obstacles:

• Demand and payment risk. Many users (farmers, low-income communities) either cannot pay or are unwilling; commercial viability is weak without subsidy or public procurement.
• Procurement friction. Governments usually prefer big infrastructure contracts; small pilots are easier but scaling is slow.
• Finance constraints. As CPI found: “affordability of finance” and “limited supply of bankable projects” are major limitations. 
• Data gaps & interoperability. Without local sensors, standardised APIs or institutionalised data-sharing, solutions remain brittle.
• Policy/regulation lag. If legal frameworks, open data mandates and procurement reforms don’t keep pace, startups are left in limbo.

Government role – what must happen

If I were advising a government, I’d urge these five actions:

1. Commit to rapid procurement windows: allocate dedicated budgets for resilience tech (not just studies) so startups can contract and scale.
2. Mandate open data/ APIs from agencies like NiMet and NIHSA; make hydrological & meteorological data accessible.
3. Establish blended-finance/guarantee facilities that de-risk private investment in resilience (so startups can raise funding).
4. Embed impact-based early-warning systems in national disaster-risk management plans; authorise automatic triggers (e.g., cash transfers, evacuation alerts) when thresholds are exceeded.
5. Support local capacity at state and municipal level: invest in drainage, sensors, maintenance funds and community-volunteer networks.

Donors & development finance – their move

Donors and multilateral funds should focus on enabling, not just funding studies:

• Provide first-loss and outcome-based grants to make resilience commercially viable for startups.
• Fund data infrastructure: sensors, river gauges, ground monitoring networks and software platforms.
• Support risk transfer mechanisms, e.g., parametric insurance tied to flood/crop loss, accessible for rural farmers.
• Act as procurement catalysts: fund multi-year contracts that governments can absorb, reducing risk for startups.

Quick wins in next 12 months

• Launch a low-cost river-gage + SMS alert pilot across 1-2 high-risk LGAs identified by federal alerts.
• Bundle climate-smart advisory + micro-credit + parametric insurance for crop planting next season.
• Co-develop with NiMet a verified API feed for flood forecasts and package it commercially to insurers.

Medium to long-term (1-5 years)

• Build integrated river-basin monitoring (NIHSA + regional partners) and link to automated insurance triggers.
• Expand urban-resilience programmes: retrofit drainage, deploy nature-based solutions, create maintenance markets.
• Develop national procurement frameworks & climate-resilient infrastructure codes so tech innovation is institutionalised.

KPIs worth tracking

Choose measurable indicators:

• Time from warning to evacuation (hours) in pilot areas.
• Number of smallholders covered by parametric protection.
• % reduction in crop loss in project pilot zones year-on-year.
• Time from pilot to procurement contract for a resilience startup (months).
• Amount of blended finance mobilised (USD) for resilience.
• Number of municipalities using startup-delivered dashboards.

Risks & ethical issues

• Beware of “tech-solutionism”: technology alone won’t solve structural issues. Community involvement matters.
• Data privacy: especially for farm, household or geospatial data. Ensure consent and benefit sharing.
• Elite capture: resilience programmes must reach marginalised groups, not just well-connected players.

I believe we have a real opportunity in Nigeria. Startups are prepared to build the tools; the urgency is undeniable. But without policy clarity, finance reform and institutional buy-in, innovation will stall in pilots. 

If the next 12 months see coordinated action among startups + government + donors, we’ll move from reactive relief to proactive resilience.

The Japanese automaker wants to secure long-term influence in areas such as mobility, climate technology, AI, and automation.

Toyota revealed two major developments this week. First, it created Toyota Invention Partners Co. with about $670 million to nurture startups at their earliest stages. Second, its venture arm Woven Capital has launched a fresh $800 million fund, doubling down on growth-stage investments. 

Together with Toyota Ventures, these three units now control more than $3 billion in committed capital.

Beyond money, Toyota wants to enhance innovation by following companies across their life cycle, from the “zero-to-one” invention stage, through growth, and, for those that succeed, integration into Toyota’s own balance sheet.

George Kellerman, general partner at Woven Capital, explained the strategy: “One way to think about them (Toyota Invention Partners) is they’re bookending what Toyota Ventures and Woven Capital are doing. They’re doing the really early stage on one end, but then they’re maybe doing these longer-term project finance, asset management type of infrastructure investments, that might be a 30-, 40-, 50-year type of investment.”

That approach is already being put into practice. Toyota’s Woven Capital has taken a stake in Los Angeles-based Machina Labs, a manufacturing startup that merges AI and robotics to produce metal structures at speed. Toyota Motor North America will run a pilot using Machina’s system to create car body panels and accessories. The value of the investment remains undisclosed.

Woven Capital, set up in 2021 with its first $800 million fund, has invested in 18 companies including Foretellix and self-driving startup Nuro. Its second $800 million fund will target 20 to 25 companies in sectors such as AI, automation, climate technology, energy, and sustainability.

The company’s vision is not limited to capital deployment. Woven City, Toyota’s 175-acre prototype urban hub at the base of Mount Fuji, is designed as a live testing ground for startups. Residents, researchers, and entrepreneurs will live and work in a connected environment where Toyota can trial technologies in real-world conditions. 

Toyota Invention Partners will play a very important role here, giving startups access to data, infrastructure, and long-term collaboration opportunities.

“The thing that really excites me is that Toyota is clearly leaning in; they’re committing over $3 billion across Toyota Invention Partners, Woven Capital’s fund one and two, and all of Toyota Ventures funds. And it’s really about making sure that we can serve the needs of the market and the founders that we’re working with, because their needs change depending on their stage,” Kellerman said.

Toyota’s strategy stands out among global automakers. While competitors like Volkswagen, Ford, and Hyundai are expanding their venture efforts, none have adopted a full-spectrum “invention to maturity” model at this scale. 

For Toyota, venture capital is about embedding startups into a future city and boosting how industries like mobility, energy, and automation evolve over the next half-century.

“But beyond these, there’s a space where unicorns, those billion-dollar minds of the business world, are no longer imaginary but tangible outcomes of Africa’s entrepreneurial determination.”

Tech unicorns are the new celebrities, and Africa is no longer in the shadows but birthing top global startups. From Lagos to Nairobi, Cairo to Cape Town, entrepreneurs are tackling local and global challenges with scalable, tech-driven solutions.

Investors are finding their new billion-dollar obsession on the continent, but really, “Who knew the next Silicon Valley would be in Africa?”

In the past few years, we’ve seen companies like Flutterwave, Chipper Cash, and Jumia, which have achieved unicorn status and also created ways for others. 

Entrepreneurs like Olugbenga Agboola of Flutterwave have attributed their success to understanding local challenges and translating them into global solutions. Agboola shared during an interview: “I personally believe in just doubling down and getting the work done which is why I’ve been busy building the infrastructure, the technology.” 

These companies are solving problems for Africa; and creating models that can work anywhere in the world. The focus is on scalability. 

According to data from Partech, African tech startups raised over $3.5 billion in 2023. As of September 2024, these startups had already crossed the $2.1 billion mark, according to Weetracker—an increase compared to $1.7 billion in funding for the same period in 2023. Though 2024 started slow, the pick-up was commendable.

One of the outstanding deals of the year was Moniepoint’s $110 million Series C funding round in October 2024. This raise, led by Development Partners International, with participation from Google’s Africa Investment Fund, Verod Capital, and Lightrock, made up 43% of the total $250 million raised by African startups in just one month.

The capital boosted the startup funding sector in Africa and also asserted the strength of the growing fintech sector on the continent.

Globally, unicorn startups typically come from a mix of sectors, youthful populations, and market demands. Africa has all three in abundance. 

The continent has the youngest population in the world, with a median age of just 19.6 years, and is home to over 1000 active tech hubs. Combined with a rapidly expanding digital economy—projected to reach $712 billion by 2050—Africa’s startup sector is a bubbling cauldron of opportunity.

Sectors on the Go for Unicorn Growth in 2025

While fintech has topped the African startup sector, 2025 looks to be a year with more diversified unicorn companies. These industries will be driven by innovative solutions and increased investment.

1. Fintech: The Reigning King
   Fintech remains Africa’s most funded sector, accounting for over 40% of venture capital inflows. With an unbanked population estimated at 57%, digital payment solutions, credit access, and blockchain innovations have huge prospects. Startups like Yellow Card and Paystack are leading advancements in decentralised finance and SME lending. Africa’s mobile money market, according to McKinsey, is expected to reach $40 billion by 2025, thanks to the increasing smartphone penetration. Mobile money solutions like M-Pesa and Chipper Cash are bolstering financial access, and the fintech ecosystem is not showing any signs of slowing down.

1. Climate Tech and Renewable Energy
   Africa’s energy challenges—over 600 million people lacking electricity—have led startups to innovate with renewable solutions. Companies such as Kenya’s BasiGo, which focuses on electric buses, and solar startups like M-KOPA and d.light are enhancing access to energy and enhancing sustainability. Investments in the sector are projected to hit $44 trillion by 2030, with $35 trillion allocated to transition technologies such as efficiency, electrification, grid expansion, and flexibility, according to the International Renewable Energy Agency (IRENA)
2. HealthTech: Building Resilient Healthcare Systems
   The pandemic uncovered gaps in healthcare systems, but also stimulated innovation. Startups are leveraging telemedicine, AI-driven diagnostics, and affordable healthcare solutions. Helium Health is digitising patient records, while mPharma is tackling medication accessibility. The healthcare market is projected to grow to $259 billion by 2030, with startups addressing challenges through technology.
3. AgriTech: Feeding a Billion People
   Agriculture employs over 60% of Africa’s population but faces inefficiencies along the value chain. Companies like Kenya’s Twiga Foods are connecting farmers to markets using technology, reducing waste and increasing profits. The agritech market is expected to grow 12.2% annually, reaching $26.27 billion by 2025.
4. EdTech: The Future of Learning
   With a young population and increasing internet penetration (currently at 43%), edtech is a natural growth area. Startups like Nigeria’s uLesson are delivering affordable, high-quality education to millions. Africa’s edtech sector is projected to grow at a compound annual growth rate of 16.3% through 2025.
5. Logistics and E-Commerce: The Amazon of Africa?
   Fragmented logistics have historically limited e-commerce, but startups like Sendy and Jumia are bridging the gap with efficient delivery systems. Africa’s e-commerce market is expected to reach $56 billion by 2029, driven by improved infrastructure and increasing trust in online shopping.

The Growth Drivers

Several factors will influence the rise of African unicorns:

• Investment Trends: More diversified funding, with international venture capitalists and local investors betting on startups. Cities like Ibadan, Kigali, and Alexandria are emerging as investment hotspots.
• Infrastructure Improvements: Expanding 5G networks and cheaper smartphones are driving connectivity.
• Talent Pool: Africa contributes 10% of the world’s tech talent, with Nigeria and Kenya leading in developer resources.

Challenges to Overcome

The challenges cannot be ignored and African startups are sometimes hit hard by these. Funding gaps, regulatory complexities, and infrastructure deficits are some of the issues that limit growth, with over 75% of startups failing within their first five years.

Geopolitical instability in certain regions causes risks for both startups and investors. Added to this, the lack of mature exit strategies, such as IPOs, has raised questions about long-term returns for VCs. 

Again, Africa’s brain drain phenomenon—where top talent migrates abroad—is a big issue. Addressing these challenges will require innovative public-private partnerships.

Predictions for 2025

By 2025, Africa is projected to double its unicorn count, hosting at least 10 billion-dollar companies. Startups like Egypt’s MNT-Halan (fintech), Kenya’s Wasoko (retail supply chain), and Nigeria’s Moove (vehicle financing) are likely prospects.

Emerging hubs like Kigali and Accra are joining established centres such as Lagos (Yabacon Valley), Nairobi (Silicon Savannah), and Cape Town. These hubs are promoting innovation and creating a favourable environment for Africa’s next unicorns.

While cities like Lagos, Nairobi, and Cairo are usually in the spotlight, emerging hubs like Kigali and Alexandria are proving their mettle. For instance, startups in Rwanda are benefiting from government-backed innovation programs, like the Kigali Innovation City project, which provides incentives for tech companies. Alexandria, Egypt, is also promoting a growing community of entrepreneurs through its proximity to top universities and access to global markets via the Mediterranean.

Flutterwave, Africa’s highest-valued fintech, became one of the unicorns through a combination of strategic partnerships and relentless focus on market scalability. Its partnership with global payment platforms like Visa and Mastercard enabled seamless cross-border transactions, while its early focus on SME solutions gave it a strong foothold in untapped markets. 

The company’s $250 million Series D round in 2022 and its subsequent expansions into Latin America and Asia showed how African startups can become global competitors.

For Africa’s unicorns to thrive, stakeholders must play their part. Governments need to create clear and consistent policies to support innovation, investors must take risks beyond the usual hubs, and entrepreneurs must focus on sustainable growth rather than quick exits. 

“The future of Africa’s innovation is in the hands of those willing to stay the course—because unicorns aren’t built overnight.”