Nigeria’s securities regulator has urged local founders to look nearer to dwelling for capital, arguing that crowdfunding and debt markets can provide a route to an eventual inventory market itemizing.
Emomotimi Agama, director-general of the Securities and Exchange Commission, advised Moonshot by TechCabal in Lagos on Wednesday that founders might begin by elevating cash from individuals who already trusted them, then use devices akin to business paper to take a look at investor urge for food. Debt might additionally assist entrepreneurs fund progress with out surrendering fairness, he mentioned.
But he warned towards utilizing short-term financial institution loans to finance long-term ambitions. “That’s a mismatch that will drown you.”
“The problem that a lot of people have is that they are shy of speaking to the regulator or even financial advisers,” Agama mentioned. “Once we understand your constraints, we are also able to tell you exactly how to go about it and what you need to do to raise capital.”
The SEC needs the local market to take in extra of the cash founders now chase abroad. On October 19, Vice President Kashim Shettima unveiled the Nigerian Capital Market Master Plan 2.0, a 10-year roadmap focusing on ₦750 trillion ($549 billion) in market capitalisation by 2036. Agama mentioned the market has already grown from ₦55 trillion ($40.3 billion) in 2024 to greater than ₦162 trillion ($118.6 billion). He pointed to the Dangote Petroleum Refinery IPO, which closed on October 27 after an SEC-approved extension, saying buyers from 54 African international locations subscribed.
Digital asset corporations received a blunter message. In January, the SEC raised the minimum capital for crypto exchanges and custodians to ₦2 billion ($1.46 million) from ₦500 million ($366,000), with a compliance deadline of June 30, 2027. Agama mentioned capital necessities take a look at whether or not an organization can perform its enterprise, and he urged younger founders to pool sources with companions. “You cannot be a cockroach and decide to wrestle with elephants,” he mentioned.
Licensing has additionally moved slowly. An viewers member from the Virtual Asset Service Providers Association requested why no crypto platform is totally licensed, greater than two years after the SEC launched its Accelerated Regulatory Incubation Programme (ARIP) in June 2024. Quidax and Busha obtained provisional licences that August and are nonetheless awaiting full approval. Agama mentioned the SEC has charged ARIP corporations no charges whereas it research the dangers in their companies, and that it can’t act alone as a result of different regulators share the house.
“If you are not an investor, then you must be a victim,” he mentioned, which means anybody who invests in an unregulated enterprise.
For founders constructing stablecoin or tokenisation merchandise, the lesson is to have interaction early. Agama mentioned the SEC oversees digital asset exercise outdoors funds, whereas the Central Bank of Nigeria handles funds. Firms that fall underneath SEC guidelines and keep away are in violation, he mentioned, and “ignorance of the law is not an excuse.”
