Nigeria’s fintech sector is booming, but beneath the headlines of funding rounds and unicorn valuations lies a troubling pattern. Many of these companies, despite their growth, still operate like one-person shows where critical decisions happen behind closed doors, accountability is scarce, and oversight is treated as an inconvenience rather than a necessity.
For Adebare Akinwunmi, a tech lawyer and partner at CrestHall Attorneys, who has watched this ecosystem evolve, the warning signs are impossible to ignore.
“The Nigerian fintech and startup space is full of cautionary tales that could have turned out differently if there had been proper board oversight and governance structures in place,” he explains.
Many of the scandals and collapses that have shaken the industry can be traced back to one fundamental problem: decisions made without checks, finances handled without scrutiny, and strategies pursued without challenge.
But what concerns him even more are the crises that never make the news. “In my professional experience, I’ve encountered numerous startups facing internal crises that never became public but were just as devastating internally,” he says, describing scenarios of financial mismanagement, leadership fallouts, and regulatory breaches where founders’ personal decisions compromised entire companies.
The roots of this governance crisis run deep. Most fintech companies begin with a visionary founder who funds operations, builds the product, and makes every critical decision. In those early days, this centralised approach worked well because it’s fast, efficient, and cost-effective.
But as Akinwunmi points out, “As the company grows, the same centralised decision-making becomes a liability.” Without proper oversight or legal structuring, the founder’s dominance becomes embedded in the company culture, and once that culture is set, it becomes incredibly difficult to change.
The problem is compounded by what he calls an experience gap. Many founders come from startups with weak corporate systems or have never operated within a robust governance framework.
“Leadership, structure, and delegation are learned skills, and when those skills are missing, it’s easy for founders to replicate the same informality they once escaped,” he notes. The harsh reality is simple: you can’t institutionalise what you’ve never experienced.
Then there’s the intoxicating nature of power itself. The sense of control that comes from building something from scratch can easily transform into resistance to shared decision-making.
Some founders genuinely believe they’re protecting their company’s vision when, in reality, they’re limiting its potential. Akinwunmi describes this as a form of corporate self-sabotage, where the refusal to delegate or empower others ultimately undermines the very success the founder is trying to protect.
The legal consequences of this governance vacuum are severe. Akinwunmi emphasises that transparency and accountability are not just buzzwords but the foundation of sound corporate governance.
One of the major advantages of maintaining a proper corporate structure is that key decisions are reviewed, deliberated upon, and stress-tested before execution. When leadership is centralised in one person, those safeguards disappear.
The result is an increased likelihood of breach of fiduciary duties, serious accountability gaps, and undermined business continuity. If the founder becomes unavailable due to illness, exit, or death, there’s often no institutional memory to sustain operations, leaving employees unpaid, customers stranded, and investors uncertain.
Perhaps most damaging is the erosion of trust. “Employees become disillusioned when decisions seem arbitrary; investors lose confidence when financial or governance information isn’t transparent,” he observes. These outcomes carry reputational and financial costs that can cripple a startup’s growth prospects, especially when expanding beyond Nigerian borders.
This is where the global ambitions of Nigerian fintech entities face their biggest test.
Akinwunmi draws a sharp contrast with Nigerian banks, which have managed to dominate regionally precisely because of the strong regulatory and corporate governance framework enforced by the Central Bank.
Getting it right at home laid the foundation for seamless expansion abroad, with minimal regulatory friction and sustained investor confidence.
Fintech companies, despite being agile and well funded, lack that corporate discipline. Regulators in new markets look beyond product innovation and assess leadership accountability, compliance culture, and internal controls. Without those elements, global expansion becomes an uphill battle.
The solution doesn’t require massive budgets. Akinwunmi advocates for creating a culture of open dialogue where everyone on the founding team can participate in key decisions, ask difficult questions, and challenge assumptions.
Documenting decisions, clearly defining roles, and bringing external advisors early can make an enormous difference. “Good governance isn’t about adding bureaucracy; it’s about building systems that let founders focus on innovation without losing control of accountability.”
His conclusion is stark but hopeful. “It’s not alarmist to say that a large chunk of today’s startups are disasters in the making; it’s simply the truth born of patterns we’ve seen before.”
Nigerian fintech entities have proven that innovation is not their weakness. What they need now is the courage to build governance structures that match their ambition, because while innovation may win attention, governance wins longevity.
