Nigeria Startup Act attracts 12,948 small businesses as labeling begins

Some 12,948 startups have so far been registered through the Nigeria Startup Act. The National Information Technology Development Agency (NITDA), which disclosed this, said they were registered for labeling.

The registration, which is being done through the startup portal, is the first step in implementing the Nigeria Startup Act, which was signed into law in October 2022 by former President Muhammadu Buhari.

Through the registration portal, which was opened in November 2023, NITDA said it has also registered 912 venture capitalists, 1,735 angel investors, and 925 accelerators, incubators, and hubs.

While inviting Nigerian startups to register on the platform, NITDA said the registration will make them “become eligible for statutory incentives, resources, and opportunities.”

According to the Minister of Communications, Innovation, and Digital Economy, Dr. Bosun Tijani, the portal allows the government to initiate the process of setting up the startup consultative forums to select representatives to the National Council for Digital Innovation and Entrepreneurship while facilitating discourse and consensus among Nigerian ecosystem players.

Responding to NITDA’s update on the registrations recorded on the portals so far, Tijani in a post on X said: “I am delighted that the Nigeria Startup Portal, which will label startups and register other ecosystem actors has now been deployed. The platform will also facilitate a consultative forum where issues affecting startups can be discussed and properly defined for action by the government and other stakeholders.

“We will be prioritising the objectives of Startup Act to improve the operating environment, prospects, and opportunities for our Startup Ecosystem and I’m encouraging members of the ecosystem to visit the platform and register.”

Going memory lane, when the bill was signed into law on October 19, 2022, it provided for what qualifies a company to register and obtain startup status.
The Act stipulated among others that before a company can be labeled a startup, it must obtain a certificate known as the startup label. This means that only companies with the startup label will be recognized as startups.

It mandated that a Startup Support and Engagement Portal be established to facilitate the issuance of the startup label and bridge the gap between regulators and startups. It also spells out the requirements for a company to obtain a startup label. Companies issued with a startup label have obligations under the bill and failure to comply with these obligations can revoke their startup label.

According to the Act, for a company to be named a startup, it must be a registered limited liability company that has been in existence for not more than ten years from the date of incorporation, amongst other requirements.

Startups can access a special seed fund created under the Act. The Act establishes a Startup Investment Seed Fund, which is designated for startups alone. It will provide finance and tech relief for startups. This means increased access to funding that will grow the startup ecosystem. It will be easier for startups to fund their operations by leveraging the grants and loans that will be available to them.