By Ayan Valentin | Interface Africa
When Ambition Meets Harsh Reality
In 2011, Jason Njoku, the founder of iROKOtv, embarked on an audacious journey to digitize Nollywood, Africa’s largest film industry. With over $35 million in venture capital including from global tech giant Tiger Global (investors in Netflix and IVI) iROKOtv aimed to become the “African Netflix.”
Yet 13 years later, Njoku admits:
“The $100 million we invested in IROKOtv for the Nigerian market was a mistake. If I had another opportunity, I would not do it again.”
This statement is more than a confession. It’s a sobering indictment of Nigeria’s streaming potential and a wake up call for Africa’s startup ecosystem.
The Vision: Building a Nollywood Streaming Empire
Backed by big data and big money, the playbook seemed simple:
Local content + massive population + mobile growth = digital goldmine.
Tiger Global’s faith was clear. They had backed similar ventures in Brazil, China, and Russia and saw Nigeria as the next frontier. iROKOtv promised Nollywood at your fingertips.
But Nigeria wasn’t ready.
- Mobile data was unaffordable (often 3–5x higher per GB than in the West)
- Online payments lacked trust and efficiency
- Smartphone penetration was slow
- Power and broadband infrastructure were inconsistent
Despite iROKOtv’s early success with diaspora audiences, Nigeria’s domestic adoption stalled.
The Grind: A $100 Million Survival Story
From 2011 to 2023, iROKOtv burned through over $100 million spent on content acquisition, Android optimization, kiosk networks, call center agents, and peer-to-peer distribution tech.
“We weren’t winning. We weren’t losing. We were just… surviving.”
Even as iROKOtv scaled outreach, its core market proved unforgiving. With Nigeria’s GDP per capita hovering around $2,000, a ₦4,000 ($5/month) subscription became a luxury.
Meanwhile, global streaming giants like Netflix, Amazon Prime, Showmax, and Iflix invested over $1 billion in Africa between 2015 and 2023 only to meet the same fate. By 2023, Netflix and Amazon had reduced their Nigeria focus. Showmax remained but not profitably.
The Shift: Content Was King, Not Streaming
In an unexpected twist, Njoku found iROKO’s hidden value in ROK Studios its lean, content-licensing division.
- ROK employed <30 staff
- Contributed 80% of iROKO’s revenue
- Only consumed 25% of total costs
- Enjoyed EBITA margins of 35–40%
In 2019, Vivendi/Canal+ acquired a majority stake in ROK for $25 million, allowing iROKO to exit the Nigerian streaming space by 2023. ROK’s model producing Nollywood content for DSTV, SKY, and others proved far more profitable than streaming.
“Streaming wasn’t the winning model for Nollywood in Nigeria. Content, channels, and distribution were.”
What Entrepreneurs Must Learn
Njoku’s journey isn’t just about media. It’s a case study in African tech startup economics. His key lessons:
- Don’t Over-Raise
Venture capital can cloud judgment. Njoku warns:
“Over-raising distorts your sense of urgency and realism.”
2. Capital Can’t Fix a Broken Market
No amount of money can solve infrastructure or policy rot. Broadband, power, payments, and trust are structural—not fixable with code alone.
3. The Nigerian Consumer Is Overestimated
Many pitch decks assume a digitally-savvy, middle-class population. Reality? The actual addressable market is under 5 million.
4. Your Best Market May Be Abroad
iROKO’s diaspora revenues dwarfed local ones. International users had better devices, faster broadband, and smoother payments.
Broader Implications: The Mirage of African Streaming
Even Multichoice, Africa’s largest pay-TV company, is feeling the sting. In its 2024 H1 financials, Nigeria was blamed for:
- FX losses
- Subscriber churn
- Revenue erosion due to inflation and economic decline
Multichoice is now being acquired by Canal+ in a $2.8 billion deal not for expansion, but for stabilization.
The message is clear:
Africa’s largest markets are not always its most viable.
Conclusion: Truth From the Trenches
Jason Njoku isn’t just a founder he’s a war-scarred oracle for Africa’s tech space.
“It’s okay that we tried and failed. It’s okay to accept the limitations of the domestic market we find ourselves in.”
His candid reflection shatters the myth that money and grit are all it takes in Africa. Sometimes, the market is simply not ready and that’s not a founder’s failure.
This story should guide African investors, founders, and policymakers: real innovation isn’t just about dreams; it’s about timing, terrain, and truth.
📍 Published by Interface Africa Magazine
📅 June 2025 Edition
📧 publisher@interfaceafrica.co.uk
