Grace Ashiru
Tizeti, a Y Combinator-backed internet service provider operating in Nigeria, Togo, and Ivory Coast, is set to list on the Nigerian Exchange (NGX), two years after first revealing its plans to go public. The company’s Initial Public Offering (IPO) will enable Tizeti to raise capital from a broader base of investors at a time when venture capital (VC) activity remains subdued. It will also provide early investors with an opportunity to exit their investments.
By raising funds in naira, the eleven-year-old company aims to sidestep the challenges of delivering VC-level returns, a particularly daunting task given the ongoing naira devaluation and the slowing economy.
“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,” said Temitope Osunrinde, Vice President for Marketing at Tizeti Networks, though no timeline for the IPO has been disclosed.
The Initial Public Offering (IPO) marks a significant milestone for the NGX, which has long struggled to attract Nigerian startups to list on its exchange.
African startups frequently choose to list on international stock exchanges such as the NYSE. However, many have encountered the harsh realities of those markets.
For instance, after e-commerce giant Jumia launched its Initial Public Offering (IPO) in 2019, its shares initially traded at approximately $14.50, only to experience a rapid decline. Today, Jumia’s shares are valued at $4.64, with a market capitalization of $469 million—less than half of its nearly $2 billion peak during its earlier, more optimistic days. Similarly, NASDAQ-listed Swvl Holding has faced a steep drop, with its share price plummeting from around $247 per share in 2021 to $6.34 in 2024.
Given the limited success stories of African startups listing on foreign exchanges, industry experts like Iyin Aboyeji advocate for startups to explore listing on the NGX once they achieve $1 million or more in annual recurring revenue (ARR).
They need to think carefully about why they need to raise a Series A and from whom. Raising a Series A from a fund that can’t fund you to a global IPO scale is a fool’s errand,” Aboyeji wrote in a LinkedIn response to Tizeti’s announcement.
Founded in 2013 by Kendall Ananyi and Ifeanyi Okonkwo to make the internet more affordable and accessible in West Africa, Tizeti self-reported $1.2 million in 2018 revenue from 3,000 subscribers. The company is backed by Y Combinator, 4DX and Ventures Platform and has raised $7.4 million in two funding rounds since its launch.
In 2014, Tizeti differentiated itself by offering unlimited, uncapped internet at affordable prices. Its cost-effectiveness is hinged on using undersea cables from providers like MainOne and solar-powered towers.
The company believes its solution is superior to satellite-based internet providers like Starlink, which are expensive and prone to congestion. Tizeti’s products include subscription-based unlimited internet access for homes and businesses in Nigeria and Ghana, co-branded Wi-Fi hotspots with Facebook in high-traffic areas, Voice over IP (VoIP) service, and more recently, FREEFIBER.AFRICA, a new subscription service offering a US IP address, phone number, debit card, and mailing address for $10/month.
Tizeti’s network currently delivers over 180 terabytes (TB) of data daily, surpassing a total of 35,219 TB by December 2023.
