NGX Tech Listings Stalled as Awareness Gap Drives Startups Toward Acquisitions
Nigeria’s technology startups are showing little interest in listing on the Nigerian Exchange Limited (NGX), with a new report pointing to a significant awareness gap as a key obstacle. The study, Rethinking Funding and Exits: Nigeria’s Missing IPOs and the NGX, by TLP Advisory, identifies systemic barriers that limit the ability of high-growth startups to raise capital locally, threatening long-term sustainability and wealth creation in Africa’s largest economy.
Despite the NGX Technology Board launching in 2022, no tech company has listed to date. Survey results show that 53% of startup founders are unfamiliar with the listing process, while 46% prefer acquisitions over IPOs. Only 21% are open to an IPO, often considering foreign exchanges instead. The currency mismatch—raising funds in dollars but earning in naira—further drives startups toward offshore exits, according to TLP Advisory.
Market frictions add to the challenge. About 26% of founders cited compliance costs and potential undervaluation, and 16% flagged low market liquidity as concerns. Yet, optimism remains: 42% indicated they would consider listing on NGX if reforms are implemented, and more than half expressed positive sentiment toward the local capital market.
At the Africa Prosperity Summit, TLP Advisory co-founder Odunoluwa Longe stressed the disconnect: “The issue isn’t founders’ ambition or rejection of NGX. It’s information gaps, perceived illiquidity, and currency mismatches that make offshore exits more appealing. Nigeria’s startups can compete globally, but too much value still flows abroad.” The report suggests practical steps, including education through workshops and roadshows, regulatory simplification, and improved market liquidity.
Founders like Adewale Yusuf, CEO of AltSchool Africa, emphasize actionable solutions. “NGX must actively engage founders and show what’s possible on the exchange. Clear structures and educational support can build confidence and attract local investment,” he said. TLP Advisory also recommends exploring dual listings with exchanges like NASDAQ, AIM, or the JSE to reduce reliance on foreign markets and strengthen Nigeria’s domestic capital ecosystem.
Source: The Guardian