When Nigerian edtech startup Edukoya started operations in May 2021, its founder Honey Ogundeyi aimed to revolutionise online learning for K-12 students in Africa. That same year, the company secured a $3.5 million funding to expand its business and enhance its technology.
But funding was not enough to sustain the business. In February, 2025, the startup shut down core operations citing low disposable income and other macroeconomic conditions.
Another edtech startup, Zummit Africa, which specialises in AI, data science, and machine learning services, is currently facing operational challenges and struggling to stay afloat.
Jonathan Enudeme, the company’s CEO and founder, told TechCabal that when he launched his business in 2021, he offered free AI services, garnering an 80-90% intake rate. However, when Zummit Africa shifted to a subscription model in 2022, the rate plummeted to 30%.
“Raising capital is challenging, and the target market struggles to afford basic necessities, let alone additional educational expenses,” Enudeme said.
Felix Onah, a former banker residing in Lagos, lost his job last year. He desired to transition into the data science field but was unable to keep up with his coursework due to financial constraints and his single source of income. “I couldn’t keep up because I have responsibilities.”
The situation reflects the realities edtech startups face in Africa’s most populous nation. Soaring inflation, fueled by the removal of the petrol subsidy and naira devaluation, has compelled many families to prioritise basic necessities like food and shelter over additional educational resources.
This has made the subscription model, a commonly used revenue generating tool in the edtech space, difficult to implement. Additionally, a recent 50% telco tariff hike has led to higher data costs for consumers, making the model even less effective. Experts say there is a need to adopt more flexible, scalable, and sustainable revenue models that align with the specific realities of Nigerians.
Edukoya focussed on K-12 learning and exam preparation, offering both free and premium subscription packages. The startup’s revenue model was based on subscriptions, but they struggled to convert free users to paying subscribers due to low disposable income. This was because the primary users were K-12 students, whose parents or guardians were responsible for payment.
“Startups need to be creative, to explore every avenue,” said Victor Tubotamuno, CEO of Earlybrite, an online educational platform. “ It’s about finding what works, being flexible and serving our communities in the best way possible.”
Tubotamuno said by being flexible, edtech startups should offer ‘learn now and pay later’ options by providing students with access to educational content and resources upfront, while allowing them to defer payment until a later date.
“People are struggling, and we need to be compassionate,” he said.
According to Oluwatobi Akapo, sales director at Edswot, a web-based learning platform, Nigeria’s tough economic climate makes it essential to quickly diversify, as relying on a single model is insufficient.
Akapo said his company maintains profitability through a combination of subscription models and B2B partnerships.
What models could work for edtech startups?
Apart from subscription packages, Gradely incorporates the freemium model, where users are encouraged to upgrade from a free to a paid version. Although gaining popularity, it’s not as widely adopted in Nigeria as subscription-based models.
Startups can also boost revenue by licencing educational content, software, or platforms to other businesses or organisations. AltSchool licences its learning management system and curriculum.
Tuteria, another Nigerian online platform which connects students to qualified tutors for both online and in-person lessons, charges a commission on every lesson booked through its platform. The commission rate can vary depending on factors like the tutor’s experience and level on the platform.
Business-to-Government (B2G) can reach a large number of students and educators in public education. In 2024, the Enugu State government partnered with Edves, a digital infrastructure for K-12 schools to construct 260 smart and green schools across the state and revamp the state’s curriculum and assessments using AI. The end goal of this is to bridge the digital divide in the state.
“It breaks my heart that so few are focusing on B2G edtech solutions,” Tubotamuno of Earlybrite said. “Think of the impact we could have by training public sector officials, by improving the quality of education at its core. It is a massive, underserved market, and it’s where we can make a real difference.”
Edtech startups often struggle to partner with governments due to limited funding, slow bureaucracy, infrastructure issues, digital literacy, policy barriers and outdated regulations and data privacy.
Akapo of Edswot suggests that in addition to addressing these challenges, the most crucial shift lies in the perspective of governments and public institutions as they don’t recognise the potential of edtech startups as a viable solution.
“They are not enlightened on the edtech industry and how they operate. Startups need to sensitise them on how edtech works and the benefits they would bring,’ he said.
Business-to-Business (B2B) is another area where edtech startups can explore as there are less collaborations in the industry. Nigenius partners with FlexSAF to provide quality teaching resources, while Gradely works with schools to integrate its platform and tools.
In a 2023 LinkedIn post, Pratishek Das, former regional head at Cambridge, said partnerships and alliances can take many forms, from strategic partnerships with other Edtech companies to collaborations with educational institutions and government agencies.
“The key is to find partners who share your vision and can bring complementary skills and expertise to the table,” he noted
The golden age of explosive edtech growth, fueled by abundant funding, is giving way to a harsh reality. Edtech firms can no longer afford to treat external funding as a lifeline. To survive the current economic turbulence and navigate the challenges of suppressed demand, they must embrace strategic financial diversification and build robust, self-sustaining business models.
