Forty-four million jobs could be created if Nigeria and other Africa nation’s Internet penetration reaches 75 per cent, according to a report by Endeavor Nigeria.
The report stated that three million jobs in Nigeria and other African countries would be created by online marketplaces by 2025 and 1.7 million jobs were expected by the same year as a result of Google’s $1bn investment to support digital transformation through its subsea cables between Europe and Africa.
The report titled, ‘The Inflection Point: Africa’s digital economy is poised to take off,’ said Africa’s digital economy is approaching its S-curve, a period of rapid, significant growth and would positively impact the continent’s GDP, job creation, and overall economic outlook.
It said, “Africa’s digital opportunity is large and growing; The estimated size of the digital economy is $115bn and is expected to be $712bn by 2050.
“This growth is driven by strong underlying fundamentals, accelerated by COVID-19. Investors are taking notice; between 2020 and 2021, funding for digital startups grew 2x faster than global rates, and investors are becoming active in Africa.
“Furthermore, we are seeing proven exit paths for early investors as illustrated by the increase in mega-rounds, liquidity events, and unicorns. However, there remains ‘white space’ for investors to consider. Due to the quantum of deals in the 1-5mn USD range in the last year, (600) relative to the 5-50mn USD range (~150), it is unlikely that there will be sufficient supply in the market as companies from the 1 -5mn USD range graduate to larger ticket sizes.
“Opportunities for digital disruption abound across Africa. A number of sectors are underpinned by informality and fragmentation, limiting the availability and affordability of products and services.”
According to it, investors who are keen on investing in Africa should consider the wealth of opportunities available and be prepared to adjust their business models to capture these opportunities.
Commenting on the report, Chief Executive Officer and Managing Director of Endeavor Nigeria, Tosin Faniro-Dada, said, “The data gathered in this report is clear — Africa is the next digital growth frontier.
“The combination of our young and digitally savvy population, an emerging technology ecosystem, and the impact of the COVID-19 pandemic on behavior is set to trigger an inflection point in our digitisation journey. We have been excited by the increased levels of funding that our entrepreneurs are attracting but we want to make it even easier for more investors to bring out their checkbooks to catalyse the growth that we believe is pending.”
Partner at McKinsey and Company, Topsy Kola-Oyeneyin, added, “We’ve seen a few eye-catching funding rounds and acquisitions in Africa’s technology ecosystem in recent years, but the findings of this report suggest that we barely scratched the surface.
“A number of sectors across the continent are still underpinned by informality and fragmentation, limiting the availability and affordability of products and services. These opportunities for disruption abound across the continent and this report will make it easier for interested investors to adjust their business models effectively to capitalize on these opportunities.”
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