During the 4th edition of the Doing Business in Nigeria Conference (DNBC) held in Lagos, Mr. Mitchell Elegbe, the founder and Group CEO of Interswitch, shared important insights about the future of Nigeria’s fintech industry and the challenges many startups may face in achieving long-term profitability. According to Elegbe, several fintech companies operating in Nigeria could struggle financially because many of them initially built their customer base by offering free services in an attempt to gain rapid market share.
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Elegbe explained that while free services may help attract users quickly, they often create difficulties when companies later attempt to introduce charges or monetization strategies. Customers who become accustomed to free transactions and services may resist paying fees in the future, making it harder for fintech startups to generate sustainable revenue. He stressed that businesses should focus on creating profitable models from the beginning rather than relying solely on expansion and user acquisition metrics.
The Interswitch founder made these remarks while discussing business sustainability, startup growth, and entrepreneurship within Nigeria’s rapidly evolving digital economy. Nigeria has emerged as one of Africa’s leading fintech hubs, with many startups attracting international attention and investment. Companies involved in digital payments, online banking, lending, cryptocurrency trading, and financial technology continue expanding across the country due to increasing internet access and smartphone usage.
Platforms such as Flutterwave, Paystack, Binance, and Moniepoint have helped transform Nigeria’s digital payment ecosystem by providing innovative financial solutions for businesses and individuals. However, despite the rapid growth of the sector, profitability remains a major concern for many startups competing in the crowded fintech market.
Mr. Mitchell Elegbe’s Quote on Business Profitability Strategies
“The major objective of a business is to make profit. Hence, achieving profitability should be your primary goal, which entails establishing solid unit economics right from the start. It’s crucial to focus on sustainable growth rather than chasing grandiose expansion plans without ensuring profitability.”
According to Elegbe, entrepreneurs should avoid prioritizing rapid expansion without first building stable financial foundations. He explained that startups must pay close attention to unit economics, operational efficiency, and long-term sustainability rather than focusing entirely on attracting investors and increasing valuations.
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He also discussed the limitations of relying solely on formal business education for entrepreneurial success. While MBA programs and academic qualifications provide valuable business knowledge, Elegbe noted that they often do not adequately prepare entrepreneurs for the realities of operating businesses in challenging local environments such as Nigeria. Issues such as unstable infrastructure, fluctuating exchange rates, regulatory uncertainty, limited access to funding, and economic volatility require practical problem-solving skills that extend beyond classroom theories.
Reflecting on his own entrepreneurial journey with Interswitch, Elegbe emphasized the importance of understanding local market realities and adapting business strategies accordingly. He recalled that during the early stages of building Interswitch, many international investors were skeptical about investing in Nigeria due to concerns about political instability, weak infrastructure, and economic risks. Despite these concerns, Elegbe believed strongly in the opportunities within Nigeria’s financial sector and chose to focus on long-term sustainability rather than depending heavily on continuous fundraising.
This strategic approach helped Interswitch gradually establish itself as one of Africa’s leading payment technology companies. Today, Interswitch is recognized for pioneering electronic payment solutions across Nigeria and other African countries. The company’s success story is often cited as an example of how patience, strategic planning, and sustainable growth can help businesses thrive even in difficult economic conditions.
Elegbe also warned entrepreneurs against assuming that investment funding will always be readily available. In contrast to startup ecosystems like Silicon Valley, where companies may raise multiple funding rounds over short periods, Nigerian businesses often operate in a more challenging financial environment where investor funding is limited and highly competitive.
According to him, many founders make the mistake of spending aggressively after securing investments without considering the possibility that future funding rounds may not materialize. He advised entrepreneurs to treat every investment round as though it could be the last external funding they receive for several years. This mindset encourages responsible financial management, careful budgeting, and strategic allocation of resources.
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The Interswitch CEO further emphasized that sustainable businesses are built on strong fundamentals rather than hype or temporary market trends. Startups should prioritize delivering real value to customers while ensuring their operations can generate consistent revenue over time. Companies that rely entirely on investor funding without achieving profitability may eventually struggle when market conditions change or funding becomes scarce.
His comments come at a time when Nigeria’s fintech industry is experiencing increased competition and regulatory scrutiny. The rise of mobile banking, digital wallets, cryptocurrency trading platforms, and online payment systems has created enormous opportunities for innovation. At the same time, however, many startups face pressure to balance rapid growth with profitability and compliance.
Websites such as TechCabal and Nairametrics frequently report on Nigeria’s evolving technology and fintech sectors, highlighting both the opportunities and challenges facing entrepreneurs in the country. Industry analysts believe that startups capable of combining innovation with sound financial management are more likely to survive long-term market pressures.
Elegbe’s remarks have resonated with many business leaders and entrepreneurs who believe Nigeria’s startup ecosystem needs a stronger focus on sustainable business practices. While attracting investors and scaling operations remain important goals, profitability and efficient resource management continue to be critical factors for long-term success.
In conclusion, Mr. Mitchell Elegbe’s message at the Doing Business in Nigeria Conference serves as an important reminder for entrepreneurs and fintech founders operating in Nigeria’s competitive business environment. By focusing on profitability, strong unit economics, prudent financial management, and sustainable growth strategies, startups can build resilient businesses capable of surviving economic uncertainty and achieving lasting success. His insights also highlight the importance of understanding local market realities and avoiding overdependence on external funding in an increasingly competitive fintech landscape.
