A new report has revealed a significant upward trend in the number of female-led businesses, even as Nigeria’s overall business creation rate falls to a three-year low. This development signals the growing resilience and ambition of women in the nation’s entrepreneurial landscape, despite facing more severe economic challenges than their male counterparts.
The 2024 State of Entrepreneurship (SoE) Report, released by Fate Foundation, a private-sector-led organization, paints a stark picture of a struggling business ecosystem. The report shows a steady decline in new business creation, with the birth rate dropping to 24% in 2024 from 30% in 2023. According to the report, these numbers are a direct result of the country’s harsh economic climate, which is compelling many Nigerians to start businesses out of necessity rather than opportunity.
However, a bright spot in the data shows that female entrepreneurs are increasingly defying these odds. The report highlights that women founded 47% of all new businesses in 2024, a notable rise from 42% the previous year. This trend of rising female participation is not new, as the share of female-led businesses has consistently grown from 43% in 2021 to 48% in 2024.
Despite their growing presence, these businesses are particularly vulnerable to the challenging economic environment. The report found that only 63% of female-led businesses reported growth in 2024, a drop from 74% in 2023. This is slightly lower than the 64.3% growth rate reported by male-led businesses. The decline underscores the specific obstacles women face, including limited access to finance and inadequate infrastructure.
A New Generation of Innovators
The report also notes the rise of young entrepreneurs as a powerful force in the economy. For the first time in four years, youth-led businesses accounted for the largest share of total businesses surveyed at 44.4%. This group has shown remarkable adaptability, leading in technology adoption with a rate of 72%. According to the report, this tech-savviness is a key driver of growth for young businesses.
Commenting on the findings, the Executive Director of Fate Foundation, Adenike Adeyemi, acknowledged the broader economic difficulties but emphasized the resilience shown by women and young people. “We note some green shoots, particularly among female and youth-led businesses,” she stated. “Female-led businesses have shown a notable increase in both market participation and growth…These trends underscore the potential of inclusive policies and technology-driven interventions to foster sustainable growth.”
The SoE report concludes that Nigeria’s entrepreneurial index has declined to 0.46 in 2024, down from 0.58 in 2022, signaling a deterioration of the business environment. The top challenges for entrepreneurs remain a lack of access to finance, poor power supply, and foreign exchange difficulties.
To reverse the negative trends, Adeyemi recommended that the government implement business-friendly policies to attract long-term foreign investment, enhance non-oil exports, and make business registration more accessible for informal entrepreneurs.
