How to Build a Successful Startup in Northern Nigeria

Let’s be honest, building a successful startup anywhere in the world comes with its own peculiar challenges and Northern Nigeria is no different. However, armed with a good understanding of the landscape, market opportunities and solutions to challenges that lie ahead, you can build a successful startup in Northern Nigeria which consists of these 19 states:

• North Central (or the middle belt) - Benue, FCT, Kogi, Kwara, Nasarawa, Niger, Plateau. 

• North East - Adamawa, Bauchi, Borno, Gombe, Taraba, Yobe. 

• North West - Kaduna, Katsina, Kano, Kebbi, Sokoto, Jigawa, Zamfara.

It is a terrain with a large and growing population, rich culture, and a wide range of market opportunities that startups can take advantage of.

Grab a cup of kunu and let’s dive into the things you should do to build a successful startup in the North.

Here are the steps to follow to build a successful startup in Northern Nigeria:

1. Understand the Northern Nigerian Market

Before starting any kind of business, it is necessary to carry out market research to understand the people you will be selling to. Basically, you need to know your customers. Market research involves gathering and analyzing data about the market that will help you understand their needs and wants, the market size, who your competitors are, customer demographics and psychographics, product positioning, pricing and effective marketing strategies to use.

Unlike Lagos, which is the startup hub of Nigeria:

• Agriculture is king in Northern Nigeria.

• A few cities in the North like Abuja, Kano and Kaduna have a growing tech economy

• Northern Nigeria has a large number of people who are unbanked and are open to fintech solutions that meet their unique needs

• Northern Nigeria is heavily influenced by religion and culture that shape consumer behaviour.

To guide your market research efforts, ensure that you have at the back of your mind a particular problem that you’re solving. This will help you determine if there is a ready market for the product/service you’re offering, the barriers to entry and how the environment could affect your business.

Since the market landscape is ever-evolving, ensure that you keep an eye on the market so that you can make adjustments to your strategy when needed.

2. Identify a Profitable Startup Idea. 

After carrying out your market research, you will then be able to determine whether your startup idea is profitable or not. The best startups solve real problems and make money while doing so. That’s what you should aim for.

You’ll be able to determine if it solves an actual problem that people in the North have and if they are willing to pay for a product/service that solves that problem.

Here are some categories that profitable startup ideas in Northern Nigeria fall under:

1. Agriculture
   Seeing that Northern Nigeria is largely an agrarian economy, it shouldn’t come as a surprise that agriculture is at the top of the list. Some agritech solutions you could consider are smart irrigation systems, digital marketplaces for farm produce, solutions for agro-processing, and educational platforms for agricultural training and knowledge-sharing.

Not only will these ideas help farmers increase productivity, but they can also help create income for them and a steady revenue stream for your startup.

2. Fintech and Financial Inclusion

With a large unbanked population, Northern Nigeria is ripe for fintech solutions that will help to draw in those who currently have no access to bank services. Some ideas under this category are digital banking and mobile money, micro-lending for SMEs, and Islamic finance solutions.

3. E-commerce & Logistics

These two tend to go hand in hand due to the nature of online shopping. Startup ideas you could consider in this category are B2B supply chain solutions, delivery services in major Northern Nigerian cities, and online stores for locally made products like traditional clothing that appeal to the preferences and needs of the Northern population.

4. Telemedicine

Access to quality healthcare in the North is a challenge in many parts and people would be better off with easily accessible solutions. Startup ideas in this area can take advantage of the growing digital inclusion to create telemedicine platforms, low-cost medical devices, and affordable health insurance services. With any of these ideas, you’d be solving a pressing problem and significantly impacting people’s health positively.

5. Renewable Energy
   If you’ve ever lived in Northern Nigeria, one thing that will become apparent quite quickly is that there is an abundance of sunlight and this means that alternative power solutions like solar energy can thrive there. Startups can take advantage of this to create solar power solutions for businesses and homes like the production of solar panels and solar-powered devices, energy-efficient appliances, and mini-grid electricity solutions for rural communities.
   
   

6. Edtech & Online Learning

When compared to other parts of the country, the demand in Northern Nigeria for quality education is higher. Startups can bridge the gap in this area by offering e-learning solutions tailored for rural areas, digital skills training platforms, and educational financing platforms.

The best startup ideas leverage technology to provide innovative solutions. Look for opportunities where digital transformation can improve existing processes.

3. Developing a Strong Business Plan

A business plan is a comprehensive roadmap document that details a company’s goals, financial projections and the strategies to achieve them. 

This roadmap to your business’s success is essential for attracting potential investors and lenders who will give you the funding you need to kick off. The length of a business plan varies from business to business (about 15 to 25 pages or more) so don’t fret if yours seems a little thin.

A business plan that has a good chance of achieving your business goals, if executed properly, should include the following:

• Executive summary
  Introduce what your startup is about and what makes it unique. Talk about its mission, vision and other pertinent information that gives a general overview of the business plan.
  
  

• Products and services
  What are the services or products that your startup will provide for the Northern Nigeria populace? Include them here and talk about the product’s pricing, production process, proprietary technology, benefits to your target market and other information related to your product or service.
  
  

• Market analysis
  Your market analysis needs to show the current state of the industry you’re entering, your competitors, who your customers are, their needs and preferences, the size of your target market, and how you intend to capture a sizable market share from competitors.
  
  

• Marketing strategy
  The number of customers that patronise your startup is an important determinant of whether you’ll reach your financial goals or not. To ensure that you get them in large numbers, you will need to outline how you intend to acquire and retain them in the marketing strategy. This could include brand awareness and acquisition campaigns on various distribution channels where people will get to hear about what your startup offers and how it can benefit them. You can also include how you intend to deliver your product or service to customers once they’re in the acquisition pipeline.
  
  

• The financial plans and projections

What financial targets and estimates do you have? Will you need to raise seed funds? How much will you require for operations? When do you project that you’ll break even? What are your estimated startup costs and what revenue streams do you see your business generating?
Provide answers to all these questions in this section.

A well-structured business plan will help you attract investors, secure funding, and stay focused on growth.

4. Securing Funding for Your Startup

You have the idea but you probably don’t have the funds to bring it to life. That’s the story of thousands of other innovators around the world. So how do you secure funding for your startup that’s going to take places like Abuja, Kano, Kaduna, Katsina and Plateau by storm? Unlike Lagos where there are more accessible options for funding like VC (venture capital) firms, startups in Northern Nigeria may need to rely on other funding sources.
Here are a couple of ways to secure funding for your startup: 

• Bootstrapping
  This means that you’re basically funding the startup by yourself from your personal savings and reinvesting the profits into the business. For this to be successful, you need to focus on spending on only absolutely necessary things that will contribute to the startup’s growth. After you’ve reached a significant growth level and you’re looking to expand, VCs and angel investors would be more likely to invest when they see how much growth you achieved with the little you had.
  
  

It’s tough but b y bootstrapping, you maintain complete control over your business without having to give up part or all of your business to investors, and without the cloud of debt repayment looming over you. However, it does mean that growth will likely be slow given the limited resources at your disposal.

If companies like Paystack, smallchops.ng, Shuttlers, and Bitmama could do it, so can you.

• Venture Capital and Angel Investors
  Angel investors are wealthy individuals who help startups with funding in exchange for equity. In addition, they provide business expertise, knowledge and connections while venture capital firms are organisations that invest in startups with high growth potential.
  Typically, an MVP (minimum viable product) or a working prototype is required to show that your idea is attainable.
  
  Some angel investors and VC firms:
  - Lions’ Den Nigeria

- Future Africa

- Northern business moguls & wealthy individuals familiar with the North

- Investment networks like the Abuja Angel Investors Network

- Ingressive Capital

- Y Combinator

- GreenHouse Capital

• Government and Private Grants
  The Nigerian government and some private organisations have a number of initiatives for economic growth that startups can take advantage of. Some of them are:
  - National Information Technology Development Agency (NITDA)
  - Bank of Industry (BOI) Youth Entrepreneurship Support (YES) Program
  - National Youth Investment Fund (NYIF)
  - Central Bank of Nigeria (CBN) entrepreneurship grants
  - Tony Elumelu Foundation (TEF) Grant
  
  
  

• Loans
  If you’re up for it, you can approach lenders in exchange for interest payments over an agreed-upon number of years as an alternative funding solution.
  
  

• Crowdfunding
  If you believe your startup idea is a game changer that will affect the lives of so many people positively, you can crowdfund by getting as many people as possible to each contribute a small amount of money to your efforts.
  You can get family and friends to do this or even strangers using platforms like Kickstarter, GoFundMe, NaijaFund and FarmCrowdy.

To increase your chances of securing funding, prepare a strong pitch deck and demonstrate market potential, scalability, and profitability.

5. Business Registration & Legal Requirements for Your Startup

In Nigeria, every business must be legally registered with the Corporate Affairs Commission (CAC). Decide on a unique business name, register it and obtain a Tax Identification Number (TIN) from the Federal Inland Revenue Service (FIRS).

Depending on the industry your startup is in, additional licenses may apply. Ensure you have legal help and do your own research to avoid any legal problems.

6. Build a Strong Brand & Marketing Strategy

If no one knows about your startup, you won’t make sales, therefore, marketing is non-negotiable.

This involves creating a website, social media pages, logo and brand identity that portrays your startup in a way that is appealing to your target audience.
You probably won’t be able to do all these by yourself so hiring a cost-effective marketing agency is important.

Marketing strategies for you to consider include:
- Organic and paid ads
- Optimum use of social media for brand awareness, customer acquisition and retention. Facebook, TikTok, Instagram and WhatsApp work quite work with reaching the Northern populace.
- Influencer marketing
- Content marketing and search engine optimisation (SEO).
- Offline marketing

Your marketing should speak to your audience in their language and align with their values and culture.

7. Building the Right Team & Scaling Your Business

The success of your startup depends on human resources to a large degree. This means that you must be careful with who you hire and how you lead.
You can leverage personal relationships and use platforms like LinkedIn, Indeed and Jobberman to hire skilled individuals who understand the local market. If you have the capacity, consider offering internships to build in-house talent.

To scale your business, expand to new similar markets after getting a good grasp of one locality, use tech tools to boost efficiency and seek partnerships with established businesses and government agencies for support and funding.

Successful scaling requires a balance of innovation, strong leadership, and operational efficiency.

Conclusion

Remember that you will face challenges. Building a startup will be tough, but it will also be worth it when you see the positive impact you’re having in people’s lives.

Some of these challenges could be regulatory challenges, lack of funding when you need it the most, resistance to new ideas/products, and poor electricity and internet services. Ensure you have an alternative power supply, stay updated with government policies and don’t give up on applying for grants and funding.

Keep adapting and innovating. Just don’t give up.

What startup idea do you have? Let’s talk in the comments section.