Tizeti, the Y Combinator-backed internet service provider operating in Nigeria, Togo, and Ivory Coast, has announced plans to list on the Nigerian Exchange (NGX). This is set to provide an alternative funding source for the eleven-year-old startup while offering exit opportunities for early investors.
By raising capital in naira, Tizeti aims to sidestep the challenges associated with venture capital (VC) funding, such as meeting the demanding returns typically expected by investors. This is especially significant given Nigeria’s slowing economy and ongoing naira devaluation.
Temitope Osunrinde, Tizeti’s Vice President for Marketing, confirmed the company’s IPO ambitions but also emphasized its current focus on launching a fiber broadband service. “We have started that journey but are focused now on the launch of our fiber broadband service. We will share more information on the IPO shortly,” she said.
The IPO represents a milestone for the NGX, which has struggled to attract Nigerian startups to list locally. While African startups often favor foreign exchanges like NASDAQ or the NYSE, these markets have proven unforgiving. For instance, after Jumia’s 2019 IPO, its shares plummeted from $14.50 to today’s $4.64, with its market cap now less than half of its former $2 billion valuation. Similarly, NASDAQ-listed Swvl Holdings saw its share price fall from $247 in 2021 to $6.34 in 2024.
Industry voices, including Iyin Aboyeji, believe Nigerian startups should rethink foreign listings. Aboyeji advises companies with $1 million or more in annual recurring revenue (ARR) to consider local exchanges instead of chasing Series A rounds or foreign IPOs. “Raising a Series A from a fund that can’t fund you to a global IPO scale is a fool’s errand,” he said in response to Tizeti’s announcement.
Founded in 2013 by Kendall Ananyi and Ifeanyi Okonkwo, Tizeti began as a solution to make internet access more affordable in West Africa. It differentiated itself early by offering uncapped, unlimited internet services at low prices, leveraging undersea cables from providers like MainOne and solar-powered towers to cut costs.
Tizeti claims its service is superior to satellite-based providers like Starlink, which are more expensive and susceptible to network congestion. Its offerings include subscription-based internet for homes and businesses, co-branded Wi-Fi hotspots in partnership with Facebook, and VoIP services. Most recently, the company launched FREEFIBER.AFRICA, providing users with a U.S. IP address, phone number, debit card, and mailing address for $10/month.
The company self-reported $1.2 million in revenue in 2018 and has since expanded its operations significantly. The company is backed by Y Combinator, 4DX and Ventures Platform and has raised $7.4 million in two funding rounds since its launch. By December 2023, Tizeti’s network delivered over 35,219 terabytes (TB) of data, with a daily throughput of over 180 TB.
