How The Nigerian Government Kills Innovation

This post doesn’t offer much in the way of solutions. I’m merely trying to articulate a position, and you can fill in your own details with your own anecdotes.

The story is told of a time when President Einsenhower of the United States was just President of a university. His school was growing rapidly and the campus needed to be expanded. During the design process, an argument arose between a competing group of architects about where to place the sidewalks. One group wanted to place it right in the obvious place where it seemed people would walk. The other wanted to place it where they believed people should walk. None of them could agree, and both of them felt their solution was obvious and rational and the other was wrong. Eventually Eisenhower stopped them. “Let the students walk unpaved and when you see where most of them walk, then that is where you pave.” And when they did that, they realized that the paths most of the students walked was not only the most efficient but completely different from the two positions they had been fighting about.

I suspect this story did not really happen but the lesson it illustrates is true: innovation often comes from unplanned insights enabled by frictionless, expérimentative approaches to problem solving. Which brings me to my point today.

The Nigerian government is very obviously anti innovation. It’s not just that it is incompetent at fostering it, but that it actively kills it. And it kills it even while acknowledging that it is important.

Why is innovation important? Because it’s the only way societies advance. People have problems, they find creative ways to solve them and some of those solutions find a massive Audience because they represent a better way of doing things. And largely, innovation comes about by experimentation. You think up something, you see if it works, others try it to see if it’s good, the good ones are adopted and the bad ones abandoned. It’s a human process. Not a lot of policy required except just get out of the way.

I remember a story of a young man in university in Nigeria who, annoyed by our perennial inability to provide basic electricity to our people more than 100 years after this technology was invented, decided to create a very simple way to harness wave technology at the oceans for electricity. He tested his devices. They worked. This was not some foreign genius, just a daily smart Nigerian boy. He approaches a power company to partner up to clean up and add his invention to the power generation solution. They say he needs a license. He approaches the regulator to get even a provisional license in order to talk to this company in order to test this new technology. The regulator tells him he needs at least $5m Capital just to even start the process. How can he raise $5m if he cannot even test the solution? And that was how he left that alone.

This summer, we hosted VP Osinbajo in Silicon Valley where he made a lot of speeches about how they want to support innovation and enable Nigerians to come up with creative solutions to our problems especially with tech.

So tell me why the most recent action taken by our government is to require any fintech start up to have at least $14m Capital to get an operating license? This is regardless of their business model, their actual need for said capital, their size or stage of innovation. Doesn’t matter. Put up or shut up.

So any one who had any idea of a solution that might help the people now has to either go to the incumbents who have to approve or disapprove the idea based on their own interests before deciding to partner with them. Or come up with $14m whether or not the idea itself is worth half that. Or do nothing.

My guess is, most will do nothing. And Nigeria will remain where it is.

I don’t know about the rest of you but we cannot continue like this.


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