Startup funding in Nigeria experienced a significant year-on-year decline of 28%, falling to $78.6 million in the first quarter of 2026. This marks a slowdown in capital deployment within Africa's largest startup ecosystem, with the total funding across 15 deals being substantially lower than the $109.1 million raised in Q1 2025 across 22 deals [3].

The figures, compiled by Nairametrics Research, indicate a market grappling with tighter global liquidity conditions and increased investor caution, aligning with broader global venture capital trends [3, 4]. Despite the overall decrease in funding volume, the Nigerian startup landscape saw improved transparency, with all startups disclosing their funding amounts [3].

The funding that was deployed was highly concentrated, with a small number of startups, particularly in the fintech, deeptech, and logistics sectors, securing the vast majority of capital. The top 10 funded Nigerian startups alone accounted for approximately 98.98% of the total capital raised during the quarter, amounting to $77.8 million [3].

Terra Industries, a deeptech company, emerged as the largest fundraiser, securing a total of $33.8 million across seed and venture rounds. Other notable sectors attracting investor interest include fintech and mobility [3, 5].

Market analysts suggest that while funding levels have moderated, investors are now prioritizing startups with clear revenue models, scalable solutions, and strong execution capabilities. This shift indicates a recalibration of valuations and deal structures, signaling a move towards a more sustainable and disciplined startup ecosystem [3, 4]. The pace of recovery is expected to depend on macroeconomic stability, policy reforms, and the adaptability of startups to a more capital-efficient environment [4].