Five lessons from doing business in Nigeria

August 22, 2018Guides and tips, News

By Jonas Michanek, entrepreneur and writer, and working for Ideon Science Park on an assignment as acting Incubator Manager at the Roar Nigeria Hub.

Did you know that Nigeria has around 200 million people? Did you know that it will be the world’s third most populated country in around 30 years? Did you know that Facebook and Google are starting to invest heavily in Nigeria? I did not. But now I do. And here are some other things I learned about when working in Nigeria.

Since November 2017, I have had the privilege to work for Ideon Science Park in Lund on an assignment in Nigeria. The assignment was to start the first university-based startup Incubator and Science Park at The University of Nigeria (UNN), in Nsukka. If you have read Chimamanda Ngozi Adichie’s Half of a Yellow Sun, then you know the setting. UNN is set on the Nigerian countryside with red soil, banana and mango trees, cassava plantations and great views of trees and jungle. And in the middle of that a lively campus with around 40.000 students where all the students, the faculty and their families are part of the campus. The whole city of Nsukka is basically the campus with the staff and services needed to run this academic microcosmos. The concept is very similar to another school I have attended, Duke University in the USA.

University of Nigeria Nsukka UNN

I have been to Africa many times before but never to Nigeria. Here are some of the most important things I learned.

Seventh most populated country in the world

When I ask people in Sweden to guess on how many people live in Nigeria – they often say about around 40-60 million. So did I. There are various numbers circulating – everything from around 180 million to some people arguing that it is even 250 million people. It is now the 7th most populated land in the world – the most populated in Africa – and is estimated to pretty soon being the third most populated country in the world. As population growth is one other big driver of economic growth, the middle class is growing steadily in Nigeria. As Hans Rosling writes in his fantastic book Factfulness, that this is a huge potential for global companies, with much greater potential than many western countries. If you are willing to take the risk…

And for example, Hanna Einarsson is. She is a Swede who started Oriflame in Nigeria and made a big impact, but wanted to do her own thing. So, she started Tribute – a perfume company for the Nigerian population. She saw that the creams and perfumes from Europe did not work so well in the warm weather and did not fit perfectly into the tastes of the Nigerian woman (who wanted stronger and more colorful scents). She is now enjoying tremendous growth with her lifestyle brand in Lagos, maybe (in my opinion) the coolest city in Africa besides Johannesburg, Cape Town or Nairobi.

Small economy – ready for the next step

Even though Nigeria has a great population, the economy in monetary terms is still small. For example, the GDP of Nigeria is only a little more than half of that in Sweden, with it’s 10 million population. And this makes it a market for cheap mass market products. As one of the directors of the leading Nigerian incubator CC Hub in Lagos, Tunji Eleso, told me: “There is a huge market, but still people have very little money. So, the startups we work with have to have “must-have”-solutions at a very, very low price. And go mass market. In 5-10 years, we might have a middle class of size – that can pay more”. So, Nigeria is still a small economy mostly based on the oil industry. But an economy that can be boosted with the right investments in infrastructure.

Infrastructure is still key

It is basic growth economics, but what is the key to economic development in Nigeria? It is infrastructure. As water, electricity and internet (mobile or land-based) is functioning only on and off – it really matters. It is hard to do business today without these services in place. Do you know you know what I experienced as being the biggest problem? Lack of internet. You can have electricity going on and off, because there are batteries and generators. But if the internet is not working (or is really slow or you cannot afford to pay for more mobile connection) – you cannot work in the startup world of today. And most of the incubator attendees have ideas involving internet, mobile and/or software. So, my advice to both the government of Nigeria and companies who want to locate in Nigeria – make sure that the internet works!

Mobile and drones will help Nigeria take a big leap

Even though Nigeria is not yet a booming economy, everybody pretty much has a phone. And it is mostly not phones like iPhones or Samsungs – it is Tecnos and Infinixs. The most used communication tool is WhatsApp. So, make sure you have it installed if you are entering Nigeria.

Facebook also have a huge user base and is a good tool for marketing. So mobile is big. And so are drones! As the roads are very bad in many areas, drone delivery is not a nice to have as when you see the Amazon commercials. Here it is for real. And a big business opportunity for companies. As well as a serious help for emergency situations and for the military. Because of the situation when it comes to infrastructure, Nigeria will skip some development steps and probably take the lead in areas like drones, mobile services for farming, solar panel solutions for rural areas etc.

The youth – the talent – the treasures

Trillz App
The Trillz App team at Roar Nigeria Hub

Nigerians are a young population, the median age is 17.9 years. And they are well educated, the country is bound to boom financially. Mark Zuckerberg has for example invested in Nigeria’s most prominent startup, Andela, which is mainly a software outsourcing company. I think that Nigeria is where India was maybe 15 years ago in this area. And think about what happened to for example Wipro and Infosys – these Indian companies are global star players today. Nigeria has the same potential. And this time, Nigeria has a great opportunity to learn from the ideas and shortfalls of others. Because of the internet, students can get the latest knowledge online, as well as the latest software code for free. President Muhammadu Buhari has called the Nigerian youth lazy. I think that Nigeria’s future lies in the hands of the youth, they are Nigeria’s treasure chest, not the old political and/or company structures. To get a taste of the talent, please look at the startups at the Roar Nigeria incubator that I have been part of.

So, would I invest in Nigeria?  Yes, but I would use local help to get settled. As in all countries you have to get to know the local business culture. How to communicate in the best way. How to manage the work-place. And I would go for the new tech communities with young people having a global outlook. Nigeria is not only a huge market – it is also competing with South Africa of being the African leader and the door to Africa. So, if you make it here, you can make it everywhere in Africa.

/Jonas Michanek, entrepreneur and innovation writer from NEW working for Ideon Science Park

Jonas Michanek and the entrepreneurs at Roar Nigeria Incubator
Jonas Michanek and the entrepreneurs at Roar Nigeria Incubator

Interested in doing business in Nigeria?

If you are planning to invest, locate your business or just want to do some research into the Nigerian market, please join Ideon for the Swedish Innovation Delegation in October. A handful Swedish companies will go together to meet companies, universities, government agencies and lots of talented students. The goal is to start closer business relation and partnership with the Nigerian market.

If you are interested – please contact Mia Rolf, CEO of Ideon: mia.rolf@ideon.se

More on our collaboration with the University of Nigeria Nsukka

Press release – The Incubator Roar Nigeria at UNN Nsukka becomes part of Facebook’s big investment in Nigeria

Behind the scenes with Jonas Michanek and ROAR incubator

Swedish innovation system on export to Nigeria

 

 

Swedish innovation system on export to Nigeria

December 20, 2017News

Ideon Science Park in Lund, Sweden and the University of Nigeria Nsukka have signed an agreement where Ideon Science Park will provide guidance on how to set up innovation governance and science park management with the goal of establishing the first science park in Nigeria, The Lion Science Park, during 2018.

University-of-Nigeria
The delegation from University of Nigeria, From Left: Engr. Charles Emembolu, Professor Joy Ezeilo, Dr. Isaac Nnadi, Professor Martin Nzegwu, Professor Kenneth Ofokansi, professor Benjamin Ozumba, Dr. Paul Madus Ejikeme, Dr. Jude Chukwu, Professor Francis Bakpo and Mia Rolf (Ideon Science Park)

The University of Nigeria (UNN) is about to launch the first university-based science park in Nigeria and Ideon Science Park together with Lundavision AB and Lund University Commissioned Education is providing mentorship in this regard. In December 2017, UNN and Ideon Science Park signed an agreement on an incubator and science park management project, which will be delivered during 2018.

It all started with a program at Lund University Commissioned Education (LUCE) in February 2017, with entrepreneurship training, innovation system setup and science park management as part of the program. During this visit, Professor Benjamin Ozumba, Vice-Chancellor of UNN, identified Sweden and Ideon Science Park as the main partner in creating an innovation system in Nigeria and setting up the first science park on UNN Campus, called the Lion Science Park.

” Many innovations that have changed the world have their roots in universities. In partnering with Ideon Science Park, the first science park in the whole of Scandinavia, the University of Nigeria is leading efforts in setting up the first ever university-based Science Park in any Nigerian university to fast-track innovation and entrepreneurship in Nigeria. The University is prepared to take advantage of this partnership to advance the frontiers of teaching, research, entrepreneurship, innovation ecosystem and science park development in Nigeria” says professor Benjamin Ozumba, Vice-Chancellor of the University of Nigeria, Nsukka.

At the end of November 2017, the fifth African Union – European Union summit was held in Côte d’Ivoire to strengthen the political and economic ties between the European and African continents. The agenda included mobility and migration as well as cooperation on governance, but the main theme was economic opportunities for youth. Prime Minister Stefan Löfven represented Sweden.

Great to see the successful Swedish innovation system being brought to Africa to further unleash the potential of the continent. Both Nigeria and Sweden will benefit from this venture, says the Swedish Minister for Enterprise and Innovation Mikael Damberg.

Ideon Science Park is well known internationally for our 34 year history of helping companies grow and the many innovations that have originated here”, says Mia Rolf, CEO Ideon Science Park. “Over 1,000 companies have started their journey here, supported by the Swedish innovation system and the Ideon method. We are looking forward to this collaboration and to build a close relationship with such an interesting market as Nigeria.

Jonas-Michanek,-Mia-Rolf,-Sven-Thore-Holm
Jonas Michanek, operating incubator manager at UNN, Mia Rolf, CEO Ideon Science Park and Sven-Thore Holm, CEO Lundavision

The Swedish serial entrepreneur and innovation author Jonas Michanek will work with the first CEO of Ideon, Sven-Thore Holm, Lundavision AB and LUCE in this joint project. The actual terms of the agreement have been negotiated with the help of Innovation system expert Sven-Thore Holm, who was successful in influencing the Swedish government to create a national innovation system in the early 1980s, one which is still valid today. Sven-Thore Holm travelled to Nigeria several times during 2017 and the mentoring partnership between UNN and Sven-Thore Holm has attracted great interest from the Nigerian government.

Mr Michanek will be the operating incubator manager at UNN in Nigeria on assignment from Ideon Science Park. Sven-Thore Holm will be visiting the University of Nigeria every three months for the next year to help with his expertise and advice in fast-tracking the setup of the Lion Science Park.

The potential of the talent at UNN is huge”, says Jonas Michanek. “This is one of the central hubs for the creation of the future for Nigeria.”

About University of Nigeria Nsukka

The University of Nigeria is setting up the first university-based Science Park in any Nigerian university to fast-track innovation and entrepreneurship in Nigeria. The University had, earlier in the year, established an Incubator (Roar Nigeria Hub) where young brains with great ideas will be mentored and nurtured and ideas with potential to serve a need would be helped to metamorphose into start-ups. In this effort, the University of Nigeria is partnering with the Ideon Science Park, Sweden with the hope of replicating their success story in Nigeria.

For more information, please contact:

Professor Benjamin Ozumba, Vice-Chancellor of the University of Nigeria, Nsukka
Phone: +234 708 861 7000, email: benjamin.ozumba@unn.edu.ng

Mia Rolf, CEO, Ideon Science Park
Phone: +46 708 110 111, email: mia.rolf@ideon.se

Jonas Michanek, operating incubator manager, UNN
Phone: +46 734 340 030, email: jonas@newagency.se

Sven-Thore Holm, senior advisor, Lundavision AB
Phone: +46 708999 897 email: sven-thore.holm@lundavision.se

Links:

University of Nigeria: http://www.unn.edu.ng/

Lund University Commissioned Education: https://www.lunduniversity.lu.se/international-admissions/professional-education