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Nigerian Tech Developer Exodus: The grass is greener on the other side



Tech developers

For the past few years, until recently, conversations regarding the Nigerian Tech Developers exiting to other developing countries had been rife. People were concerned by the rate at which Nigerians relocated to countries like Malaysia and Indonesia.

In more recent years, the trend appears to be changing. The developer move has been towards eastern European countries, with Ukraine topping the list and countries like Cyprus, Estonia amongst others. However, currently, the developer move has been towards much more developed European countries with Germany and Netherlands taking the lion’s share.

The relocation drive is however not limited to developers and designers alone. Nigerian doctors, I believe, initiated this trend. It was reported that over five thousand Nigerian trained doctors are currently working with the British National Health Service. This implies that Nigerian medical practitioners constitute 3.9% of the foreign staff working with the British Health Service. According to the NMA President, Dr. Mike Ogirima, the situation was blamed on poor remuneration for medical doctors, poor working environment and inadequate medical equipment and infrastructure.

The crux of this article is to examine if we should actually be concerned about this trend and how a startup can operate irrespective of the desire of developers to migrate to greener pastures.

Cheap Education, Poor Education, Great Students

I have always argued that good quality education cannot be cheap, and it cannot be free. The best-rated universities in the world are usually the most expensive. However, the Nigerian situation appears to be peculiar. We have some not so great schools (at least a few of Nigerian universities appear in the top 1000 universities globally), but we have one of the best-motivated crop of students.

The current age has improved learning outside of the university system. I was speaking to a developer, and he confirmed to me that he did not learn how to code within the university system because his lecturers are stuck with BASIC and COBOL programming languages.
Bringing this to the current scenario, Nigerian students are really motivated. Some will put their grades on the line to just learn C#. Once these guys graduate, since the school contributed little or nothing to the body of knowledge they gained, they look to earn the most from this knowledge.

Why are our Developers Leaving?

Taking a cue from the president of the Nigerian Medical Association, few things might have contributed to the situation. They include:

Poor Remuneration – Unfortunately, in a capitalist community, money flow is expected to be directly proportional to value creation. Additionally, the higher the demand the higher the price of the item. Putting these 2 together, most businesses in 2018 will require the services of developers to ensure long-term sustainability. Everyone is looking for the “tech angle” to their business, hence, the value of being a developer. These developers are however in very short supply, hence the high cost of hiring them.

These developers are so much in high demand that Nigerian businesses are facing stiff competition from foreign businesses for them. These foreign tech businesses have higher bargaining powers since they offer relocation opportunities and compensation in foreign currency (this is redundant though since your cost is in foreign currency as well except for those working remotely).

Sigma Pensions

Sadly, due to the stage of the Tech ecosystem in Nigeria, remuneration will continue to be an issue, because most startups cannot afford to pay what developers actually want to earn. If they manage to, then people in marketing and sales will complain. You might just shut the business down anyway.

Poor Working Environment – Due to capital constraints, a lot of startups still will be unable to create the most conducive work environments for their staff. Some will have to cool their offices with fans because they cannot afford air conditioners. Surely the work environment questions transcend the pay.

We have, however, noticed that most startups deliberately try to create good working environments, similar to what is obtainable at google, Uber, Salesforce and Co. This is only possible when the startup raises its funds or just got back from Y Combinator, 500 Startups and more recently, Techstars and Google Launchpad.

What then would a Startup do?

Based on the premises above, it is clear that most startups cannot afford to pay what most developers want to earn. Hence, these developers work for the most established, or the best-funded startups. These well-funded startups then lose many of the developers to foreign companies, especially So the question is how do you attract and retain the best developers even in the competitive environment.

Side Hustle to Empire – Rather than trying to raise money at the early phase of your business, I will recommend that you fund the business out of the proceeds of your current salary. By this, I mean that you should start your business as a side hustle first, before jumping into the deep end. With this method, you can pay a crop of good quality developers to build your Minimum Viable Product.

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Once that has been built, you leverage your network to conduct a Proof of Concept (POC) and iterate based on feedbacks from the POC. Once the concept has been proven, you initiate a soft launch to understand adoption and if the model can scale. Once this is done, you can then focus on your new startup to accelerate growth.

This model will allow you fund the initial development phase of your product. All you might need following this is a junior developer to maintain the system rather than building additional features.

Technical Co-Founder – Another way is to find a technical co-founder who has the skill and the ability to build the product you are trying to launch. With this technical co-founder, you will not need to be out of pocket too soon as your co-founder will build the product with assistance from his own network of UI/UX designers, front-end guys, etc. You, however, need to know that for you to get a co-founder, salary will not be the motivation; he needs to have skin in the game. So, some equity split is usually the catch.

Employee Stock Option Pool – Another way to ensure that you can get your technology business up to scratch and retain your top developer talents is to have a path to ownership for your employees through the employee stock option plan. These employees know that they might be earning below fair market price right now, but at exit, they have a share of the exit value.

Outreach and Remote Internships – A creative way is to hire 2 senior developers, but build your products leveraging remote internships. These interns will build your product for you, be the evangelists of your company, and learn to become great quality developers from thereon. From this internship opportunity, you identify the best talents and recruit those to work for your business.

In this day and age, you have to be creative to start, remain and grow a business.

Happy Entrepreneuring
Follow me on twitter @AremoFisayo

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Why SEC should support democratization of sale of foreign securities

In the spirit of progressive engagement and dialogue, many voices now suggest that the SEC take a fresh look at its latest position.



The directive of the Nigerian Securities and Exchange Commission (SEC), issued 8th of April 2021, has been met with consternation and a straightforward (but hopefully simplistic) interpretation that; “the government is out to stifle innovators, again.”

These perspectives aren’t unfounded, as innovators of all shades have taken a heavy beating lately due to a number of direct government policies or interpretations of these policies – irrespective of how well-intentioned these policies may be. On the contrary, micro-investment platforms deserve a fair shot within Nigeria’s capital market.

This is especially true considering that the recent regulatory fervour coincides with a period where the innovation ecosystem is recording new milestones and gaining traction, solving problems for users in all walks of life, democratizing wealth creation, and creating high-value jobs, all of which Nigeria desperately needs.

READ: Crypto market surges above $2 trillion, as Bitcoin stages a huge comeback above $60,500

In the last six months alone, Nigerian startups have gained the confidence of some of the best investors locally and globally, leading to never-before-seen innovations, acquisitions, and investments into the economy. This promotes interest in the Nigerian innovation ecosystem from foreign market actors and increases its relevance as a high-value job creator. Some now wonder if our regulators want more or less of this positive momentum.

This latest notice from the SEC warned Capital Market Operators (CMOs) to desist from selling securities not quoted or registered, as only registered securities in Nigeria can be issued, sold, or offered for sale. Ostensibly, the directive requires CMOs registered with the SEC to offer only securities listed on any exchange in Nigeria to the public.

READ: XRP posts a big bang, as legal tussle with SEC lingers

The challenge here is that High Net worth Nigerians (HNIs) have always had access to foreign securities offered or acquired through registered CMOs for the apparent benefit of the upside available in markets such as the United States. This should be democratized to allow Nigerians with smaller incomes to have access to valuable global stocks within fair rules, and this is what the likes of Trove, Chaka, Bamboo, and Risevest have done. In fact, this democratization should be applauded as one of the outputs of a thriving innovation ecosystem that provides practical
palliatives for the stifling inflation and erosion of value we have all experienced as Nigerians.

Sigma Pensions

After all, what is suitable for Dangote should also be good for Musa, who earns NGN50,000.00, and thanks to any of the apps mentioned above, can today invest in shares of Dangote sugar while also adding a quarter of a Google stock to his portfolio every month. This “magic” of innovation is a poverty alleviator that should be encouraged and nurtured while ensuring that the public is protected from any harmful financial practices.

READ: Flour Mills shares surge by 6.9%, lifting the miller’s capitalization by N8.2 billion

It is important to acknowledge at this point that the SEC has been a positively progressive regulator, generally engaging its public fairly. The issuance of the guidelines for crowdfunding and accommodation of FinTechs within the capital market was encompassing and engaged stakeholders of all hues. This should be commended. The SEC’s position classifying crypto as an asset class is also fair, refreshing, and proactive. We need more of this and not less.

At a time when we are exploring how the Nigerian capital markets can become a viable option for listing tech startups, this latest body language of the SEC, and the Nigerian government as a whole can be further misinterpreted.

In the spirit of progressive engagement and dialogue, many voices now suggest that the SEC take a fresh look at its latest position, as these innovations are widespread, publicly accepted, and valuable. Furthermore, these innovations support some of the registered and regulated CMOs by offering white-label solutions that are accelerating the ability of these legacy CMOs to better serve their HNI customer base, with local and foreign securities. The emergence of these innovative micro-investing platforms has triggered investments into local Nigerian securities in multiple folds. The volumes these innovative platforms channel into Nigerian stocks are arguably the most significant development in Nigeria’s capital market in a decade.

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By virtue of the existence of these innovators, their combined strength has introduced over 150,000 new market participants who are primarily millennials: a majority of whom purchased their first set of stocks through these platforms. Before now, they had no active interaction with the capital market. These new entrants are now trading in excess of NGN10,000,000,000 (Ten Billion Naira) monthly through these apps. Note that a good chunk of the highlighted trade volume is routed through local CMOs to purchase Nigerian securities on the Nigerian Stock Exchange(NSE). Long term, these innovations would also serve as a channel to offer Nigerian guarantees to a global audience which would be a massive positive for the economy.

The quest for diversification of portfolios to include foreign securities can only be good overall. It underscores the global trend in cross-border trade in securities as disintermediated by technology and the need to enhance portfolios’ value globally.

Rather than curbing the practice of offering Nigerian and international stocks in a basket, this micro-investing trend should be allowed to flourish within reasonable regulatory frameworks. These platforms make investments attractive, easier, and affordable. Micro investing will curb the menace of pyramid and Ponzi schemes while introducing a new generation into Nigeria’s securities market in parallel with their appetite for global securities. Regardless of what we decide, the world has gotten smaller, and information that enables people to easily seek the best economic outcomes is readily available. While other nations gain from micro-investing, shouldn’t our people do too?

The ultimate beneficiary of increased wealth for Nigerians is the Nigerian economy. Rather than shutting Nigerians off from the rest of the world, we should be accelerating global access for our millions of people; hence this is the time for dialogue, not shutdowns.


Kola Aina is the Founding Partner at Ventures Platform and writes from Lagos, Nigeria.

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Buy what? Dangote vs BUA Cement

Dangote Cement has a market capitalization of N3.65 trillion, while BUA posts a N2.49 trillion capitalization, but does size win?



I want to review the performance of the largest quoted companies in Nigeria.

On the Nigerian Stock Exchange, they don’t come any bigger than Dangote Cement (Dangote) and BUA Cement (BUA). Only MTNN stands with both cement companies in terms of market capitalization. Dangote and BUA are both blue-chip companies, in the same sector and both enjoy federal import protection, they also both serve a local market with huge demand for cement.

Which is a better investment? Let us assume I have N100,000.00 (One Hundred Thousand Naira,) which should I buy? Let us review both stocks with FY 2020 results they posted. For consistency, I am going to use my trading view terminal numbers.

READ: Dangote Cement joins MTN in the trillion-naira club, as 2020 revenue surpassed N1 trillion

Market Capitalization

First, we talk about capitalization, (Market cap is the number of shares issued x market value of shares ). Dangote Cement has a market capitalization of N3.65 trillion, while BUA posts a N2.49 trillion capitalization. Does size win? Dangote is bigger? Not yet!

Market Price

With N100,000 I can buy about 465 shares of Dangote at N215 a share and 1,360 shares of BUA at N73.50 per share. Is BUA cheaper? do we have a winner? Not quite. Let us dig deeper.

Dangote Cement posted a Net Income figure of N276 billion, if we divide this earning by the number of issued shares which is 17 billion, we get an Earnings Per Share (EPS) of N16.14, so every share of Dangote Cement earns (not pays) the investors N16. Similarly, the Earning Per Share of BUA is N2.0

READ: BUA Cement loses N162 billion in market value in a week

Sigma Pensions

Thus when I buy Dangote Cement N215 per share, I am buying 16 times the earnings of Dangote. We can simplify this by simply comparing the price I pay per share of Dangote to the EPS of Dangote (Price to Earnings Ratio), thus I invest my cash of N215 to buy 16 times the earnings of Dangote, thus the Price to Earnings Ratio of Dangote is 13.31 (P/E). Using the same calculation, the price for each earnings of BUA (the P.E.) is 35.38. This means even though I am paying more cash for each share of Dangote, I am paying less to buy the earnings of Dangote, thus Dangote is cheaper than BUA.

So our first milestone is reached, we have used the Net Income, Market Price, and Number of Issued shared to get the Earnings Per Share, we have then determined what amount of earnings we are buying to determine which stock is at a bargain.

READ: Oba Otudeko’s stakes in Firstbank and Honeywell are worth over N10 billion

What else?

Let us look at the earnings that will be paid in cash. Remember, Earnings, is just the Net Income of Dangote, we as equity holders have the opportunity to share in any portion of the Net Income.

Dangote in 2020 paid out from earnings N272.69 billion as dividends, this translates to about N16 per share or in terms of returns 7.44%. We get this Dividend Yield return by comparing the dividend paid to the market price per share (D/P). BUA also in 2020 paid out N59.26 billion as dividends from earnings, this translates to a dividend yield of 2.81%.

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So, if I invested N100,000 in shares of Dangote Cement, I would earn a cash return of 7.44%, if I did the same with BUA I would earn a cash return of 2.81%.

READ: Jumia: In search of the elusive break-even sales

Let us go a bit deeper…

When you buy a stock, you are buying into the earnings and cash flow. Dangote Cement in 2020 earned N276 billion and paid N272 billion as dividends meaning they retained about N3 billion for that FY while generating over N248b in Free Cash Flow. Similarly, BUA earned a net N71.52 billion, paid out N59 billion in dividends, retained N19 billion but posted a negative Free Cash Flow of (N95.49 billion). Should BUA cement have simply used that cash to finance working capital rather than paying it as dividends? Perhaps. Let us speak more of Cash flow.

Cash retained is cash not paid to you the investor. You have to ask how well your company is utilizing that cash retained. Should it all be paid out as dividends? Or retained in the company to fund expansion and growth?

READ: Three things Nigerians can learn from Warren Buffet’s latest letter

Look at it this way, if Federal Government Bonds were offering a Yield of 15% and we see that Dangote is offering a yield of 7.44%, then as shareholders you should demand that Dangote pays more cash to you to allow you to invest in FGN bonds because you get a higher return (at lower risk). The point is any company retaining cash or paying cash at a lower yield than the market is hurting the investors, who are missing the opportunity of investing higher elsewhere.

Let us score both company managers by how well they have managed the revenues and capital of the companies


 Return on Assets %Return on Equity %Return on Invested Capital %EBITA Margin %Net Margin %Debt to AssetsLong Term Debt to Assets
Dangote Cement14.6231.2126.9244.0424.310.240.08
BUA Cement11.1519.1215.3541.8732.030.360.23
FY 2020

Across the board, the management of Dangote Cement has done a better job when compared to BUA Cement in managing the assets of the company. Dangote Return on invested capital is higher with a much lower recourse to debt and of course a higher FCF number.

Overall, on Earning, Returns and Efficiency, it appears Dangote Cement posts better fundamentals…



Do follow @FinPlanKaluAja1

This is not investment advice, this is not a recommendation to buy or sell. Past performance is not a guarantee of future performance. Speak with your adviser before investing. Equity is risky.

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