In order to encourage entrepreneurship and productivity in Nigeria’s digital technology and innovative sectors, the country’s government has established a $618 million fund as part of its Digital and Creative Enterprises Program (i-DICE). Vice President of Nigeria Yemi Osinbajo spoke at the launch in Abuja on Wednesday, saying it is necessary to begin a coordinated strategy towards innovation on the continent. This would involve bringing together all key players to work collaboratively at scaling up investments and developing programs that create the right enabling conditions and develop a talent pool that promotes innovation development.
The $618 million for the initiative consists of $170 million provided by the African Development Bank and $100 million provided by the Agence Francaise de Développement, while the Islamic Development Bank offers $70 million in co-financing. In addition, the private sector and institutional investors will contribute $271 million to the fund, and the federal government, through the Bank of Industry, will contribute $45 million as a counterpart commitment, which will be made available in the form of loans to startups that meet the eligibility requirements.
Funded by many partners, the initiative will be coordinated by BOI.
More so, the i-DICE Initiative will be overseen by the Bank of Industry. Microsoft will offer technical support, collaborative learning, and capacity building predicated on a 2020 treaty with the Nigerian government, emphasizing the talent pipeline. He explained that this fund would support the expansion of both the nation’s multibillion-dollar digital environment and the creative industry. According to BD Funding Tracker, Nigerian startups raised 27.4% of the nearly $3.6 billion in funding that African startups collectively secured last year. The majority of this funding came from domestic and international private investors.
According to the Vice President, this infusion of private investment has allowed businesses to expand operations, generate new jobs, and substantially contribute to the growth of the country’s economy. It is now essential to start a systematic strategy for growth on the continent, he said, bringing together all stakeholders to work collaboratively at scaling up investments and establishing initiatives that create the ideal enabling environment and talent pipelines that enable the expansion of innovation there.
Youth entrepreneurs of ages 15 to 35 will benefit from the initiative.
Akinwumi Adesina, the president of the African Development Bank (AfDB), said that it is estimated that the program would bring in $6.4 billion for Nigeria’s economy. The initiative will concentrate on young Nigerian entrepreneurs between the ages of 15 to 35 who have innovative budding technology-enabled businesses and creative sector micro, small, and medium enterprises (MSMEs). It will also target Enterprise Support Organizations (ESOs), which would include hubs, venture capital, accelerators, and private equity.
Around $1.14 million of the $618 million will be allocated to startups led by women in these two sectors. Their goal is to make Nigeria more technologically advanced and competitive. By harnessing the energy of the young, they are planting the seeds of optimism for a brighter future in Nigeria, the president of the AfDB declared. With initiatives like the i-DICE fund, an unaided managed venture capital fund, and the gathering of over $217 million in investment funds, i-DICE aims to improve regulatory policy frameworks like the 2022 Nigeria Startup Act. The fund will also supply the necessary technological tools for de-risking digital and creative businesses on a large scale and in a sustainable way.
More skills and job opportunities will be created for the youth.
With the help of the i-DICE fund, over 175,000 young people will be given access to technological and creative resources, leading to 6.1 million new job opportunities. According to Adesina, the fund would provide financial assistance to about 451 startups, 226 creative enterprises, and 75 enterprise support organizations. According to Adesina, AfDB’s Youth Entrepreneurship Investment Bank project will scale out the i-DICE model in other regional member nations to establish a financial and non-financial services ecosystem to aid firms led by young Africans and provide employment opportunities.