Startups across Nigeria’s South-South and South-East regions attracted $10.23 million in disclosed funding between 2023 and 2025, representing a 29.6% increase from the $7.89 million recorded during the previous reporting period.
The figures are contained in the 2025 South-South & South-East Startup Ecosystem and State of Digital Jobs Report published by #StartupSouth, which examined startup activity, investment flows, digital employment, talent distribution, and ecosystem development across 11 states in both regions.
According to the report, the number of startups operating within the ecosystem increased by 54.3% to 304 companies over the two-year period. The study also identified 98 Enterprise Support Organisations (ESOs), 234 digital talents, and 29 employers contributing to the region’s innovation landscape.
Despite the impressive growth in startup numbers and funding volumes, the report highlights significant structural imbalances within the ecosystem. Funding remains heavily concentrated among a small number of companies, with just six startups accounting for 86.6% of all disclosed capital raised across the region.
As a result, while more than half of startups reported receiving some form of external funding, the median capital raise stood at only $500, indicating that many founders remain severely undercapitalised despite technically being funded.
### South-East overtakes South-South in startup share
For the first time since the report began tracking ecosystem activity, the South-East surpassed the South-South in overall startup share, reflecting a shift in regional entrepreneurial activity.
While Port Harcourt maintained its position as the largest startup hub by company count, Enugu emerged as the leading destination for disclosed startup funding, underscoring its growing influence within the innovation ecosystem.
Abia recorded the strongest increase in startup representation across both regions, gaining 4.1 percentage points between 2023 and 2025. The report attributes the growth to improving governance sentiment, infrastructure development, and renewed commercial activity in Aba.
Delta State also emerged as a rising innovation frontier, further strengthening the region’s startup footprint.
### Talent growth outpaces local job creation
The report found that nearly 70% of digital talents surveyed across the South-South and South-East were either unemployed or working as freelancers.
Among those employed remotely, approximately two-thirds work for organisations based outside the region, primarily in Lagos and international markets.
This suggests that while Southern Nigeria continues to produce a growing pool of digital talent, local employers have been unable to absorb a significant share of the workforce.
According to the report, investments in digital skills development have not been matched by corresponding growth in employer density, startup scaling capacity, or regional hiring demand.
### Structural challenges remain
Commenting on the findings, Convener of #StartupSouth, Uche Aniche, said the report confirms that innovation ecosystems across Southern Nigeria are becoming increasingly viable but continue to face fundamental structural challenges.
He noted that while entrepreneurial talent and startup founders are present across the region, critical ecosystem enablers—including access to capital, stronger institutional coordination, employer growth, and reliable ecosystem intelligence—remain insufficient.
The report argues that Southern Nigeria is gradually emerging as one of Africa’s most promising frontier innovation corridors and suggests that future startup growth on the continent may increasingly come from distributed ecosystems outside traditional technology hubs such as Lagos, Nairobi, Cape Town, and Cairo.
### Funding environment remains cautious
The findings come amid a broader slowdown in startup funding activity across Nigeria.
Industry data shows that Nigeria’s startup ecosystem recorded a modest rebound in April 2026, attracting approximately $4 million in disclosed investments across six major deals.
Fintech companies accounted for the largest share of capital raised during the month, led by Bfree, which secured a $3.1 million venture funding round.
However, investor caution continues to influence deal activity globally, resulting in smaller deal sizes and lower funding volumes compared with previous years.
While startup activity across Southern Nigeria continues to expand rapidly, the report suggests that unlocking the ecosystem’s full potential will require deeper capital pools, stronger local employment opportunities, and greater institutional support to ensure that growth in startup numbers translates into sustainable economic impact.
