2025 GITEX Nigeria Inquiry: What Exactly Do Africa's Venture Capitalists Seek in the Year 2025?
At the Gulf Information Technology Exhibition (GITEX) Nigeria 2025 Startup Festival, held at Landmark Centre in Lagos, a new era for African venture capital was unveiled. The event marked a shift away from the growth-at-all-costs approach towards a focus on unit economics, as investors and founders grappled with the reality of capital scarcity and the need for financial discipline.
The conversation at the panel circled back to the reality that capital has become harder and more expensive to access. Brian Waswani Odhiambo, Partner at Novastar Ventures, stressed the importance of diversifying capital, not only for startups but for venture capitalists themselves. He warned founders that venture capital isn't for everyone and comes with big obligations and expectations.
Oluwakemi Olajide, on the other hand, explained that Africa Climate Ventures is shifting to operator-led funds that venture build. This trend of using blended finance is becoming a crucial lever for keeping ventures alive in frontier markets like Nigeria. There's a rise in operator-led funds that roll up their sleeves to help companies scale.
Tosin Faniro-Dada, a panelist, expects startups to build localized solutions based on the current market reality. Founders are advised to dominate their home market first before expanding. Olajide cautioned founders to stay grounded in their unit economics and not overpromise or under-deliver.
Co-investments from Development Financial Institutions (DFIs) and foundations are important for African VCs as they help de-risk capital and improve return profiles. The retreat of foreign capital has created space for local investors, and this trend is expected to continue.
At the festival, operator-led investment funds were announced that specifically aim to bridge the gap between capital availability and tangible support for African startups by actively managing the investment and support process. However, the exact names of these investment providers and funds were not detailed in the available sources.
The shift signals a deeper redefinition of "active investing," moving away from quarterly governance check-ins towards actual help for companies. Investors often overpromise and underdeliver when it comes to adding value beyond the check. The event revealed a more pragmatic model, with a focus on localized, resilient solutions.
Olajide pointed out that inflation and devaluation have changed the economics of capital, making it too high whether on the debt or equity side. What counts now is whether the economics of each product, customer, and market add up. The African venture industry is entering a new era, defined by hard questions and harder answers. The retreat of foreign capital and the rise of operator-led funds are signs of this transformation.
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