Nigeria’s music and tech sectors have long been heralded as hotbeds of creativity and innovation, boasting remarkable artists and groundbreaking tech startups capable of making waves on the global stage.
From Afrobeats’ rise to global prominence to fintech startups earning international recognition, the potential is undeniable. Yet, beneath this surface of success lies a troubling trend, mismanagement of funds is beginning to erode the very foundations of these industries.
In recent years, a concerning pattern has emerged. Funding meant to propel marketing efforts, product development, and business growth is being misused or misallocated. Whether it’s a music executive diverting label-provided advances for personal indulgence or a tech founder prioritizing image over sustainable development, the outcomes are often the same, failure to deliver return on investment (ROI).
For investors, this is a major red flag. What was once viewed as a high-potential, fast-growing market is now being approached with increasing skepticism. In industries where trust is paramount, this loss of confidence has far-reaching consequences.
Why Mismanagement is a Critical Issue in Music and Tech
Investors don’t simply inject funds out of goodwill; they expect to see measurable growth, scalability, and profitability. In both the music and tech sectors, funding is intended to support brand building, product development, and ultimately profit generation. When funds are mishandled, the opportunity for growth is not just lost, the entire ecosystem begins to falter.
In the Nigerian music industry, this often plays out through advances intended for promotion and marketing being squandered on extravagant lifestyles or non-promotional endeavors. Instead of using the resources to enhance production quality, fuel digital campaigns, or create compelling content, some executives prioritize personal gain, leaving the artist’s potential growth untapped.
A similar scenario unfolds in the tech ecosystem. Startups, flush with venture capital, misuse their funds on superficial expenses like luxury office spaces, flashy PR stunts, or excessive perks. Rather than investing in product development or user acquisition, they burn through capital without achieving key milestones for sustainable success.
The Investor’s Conundrum
This pattern of financial mismanagement is alarming investors, and it’s easy to see why. When funds consistently disappear without yielding tangible results, investors naturally grow more cautious. They begin to withdraw, not just from individual projects but from the broader market. This creates a ripple effect where fewer new ventures receive funding, and even the promising ones struggle to secure the capital they need.
This growing hesitancy impacts more than individual companies or artists, it stifles the entire industry. A loss of trust makes investors less willing to take risks, which in turn slows down innovation. Cutting-edge ideas that could have revolutionized the market or catapulted Nigerian music to new heights go unnoticed, underfunded, and ultimately abandoned.
Upcoming talents and entrepreneurs are particularly affected. Even those with the most promising ideas struggle to secure investment because they are part of an ecosystem where money is perceived to be mismanaged. This creates a discouraging environment for innovation, leaving many with great potential overlooked by cautious investors.
The Pitfalls of Short-Term Thinking
Making matters worse, the mounting pressure to deliver quick results amid investor skepticism is driving even riskier behaviors. Instead of focusing on building sustainable music careers or businesses, many now chase short-term wins to satisfy investors. This shortsighted approach undermines the long-term potential of both sectors, turning what could have been lasting successes into fleeting moments of progress.
For Nigeria’s music and tech industries to thrive, there must be a shift in mindset. Accountability, transparency, and sound financial management need to be prioritized. Both artists and startup founders must understand that while investor capital may seem like easy money, it is the lifeblood needed to fuel sustainable growth. Misusing that capital not only harms their careers or companies, but also tarnishes the reputation of the broader industries they represent.
The Role of Policies and Frameworks in Music and Tech
In addition to financial discipline at the individual level, the lack of structured policies and frameworks in these industries also contributes to the problem.
Government regulations or industry-wide standards that enforce transparency, ensure accountability, and promote ethical financial practices are sorely needed. Without formalized protections, artists and entrepreneurs remain vulnerable to exploitation, and investors lack confidence in the ecosystem’s sustainability.
Some industries around the world have flourished due to such frameworks. For example, South Korea’s music industry (K-pop) has stringent systems that ensure artist development, intellectual property protection, and financial transparency, which have contributed to its global success.
Similarly, tech hubs like Silicon Valley thrive under legal frameworks that protect innovation and intellectual property, allowing startups to attract and secure funding more easily.
By adopting similar policies in Nigeria’s music and tech ecosystems, trust can be rebuilt, ensuring that funds are used for their intended purpose, whether that’s developing a product or growing an artist’s career.
Rebuilding Trust and Securing a Sustainable Future
There is still hope for both industries, but swift action is necessary. Restoring investor confidence will require more than simply delivering on projects, it will demand a cultural transformation towards responsible financial practices. Artists and tech founders must be equipped with the tools and education needed to manage funds effectively, ensuring that every dollar is used to grow the brand, develop the product, or reach new audiences.
Investors, too, must play a role by implementing more stringent due diligence processes and supporting the long-term vision of the projects they back, rather than pushing for immediate returns.
Both the music and tech sectors hold immense potential to shape Nigeria’s future. But without financial discipline, structured policies, and a commitment to long-term growth, that potential may never be fully realized. It’s time to look beyond short-term wins and focus on building industries rooted in innovation, trust, and sustainability. Only then can we unlock the full promise of these ecosystems and restore investor confidence in Nigeria’s dynamic creative and tech landscapes.
Hanotu Weli
Head of Product, SALI (Sustainability Assessment, Reporting & Learning Intelligence)
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