Nigeria’s Decagon raises seed round to finance and train software engineers

NIGERIADecagon, a software engineering, has announced its US$1.5 million seed round and a student loan financing facility of US$25 million from Nigerian financial institution Sterling Bank.

Founded in 2018 by Chika Nwobi, Decagon aims to address the underrepresentation of black people in tech globally, starting with Nigeria. The West African country is the most populous on the continent and the most populous black nation globally.

Decagon runs a six-month software engineering program and selects its candidates based on merit. It’s a paid program, and the software engineers are expected to pay about N2 million (US$4,000) tuition to get in. Then, the company employs an income-sharing model when the engineers find work and start earning upon graduation.

We got involved to support alternative education by providing loans for Nigerian students complemented with financial literacy training. Based on the excellent performance of the current portfolio, it made sense to scale our support to Decagon,” Obinna Ukachukwu, the divisional head of Sterling Bank, commenting on the student loan financing, said.

For its equity financing, Decagon raised money from Kepple Africa and Timon Capital. Some angel investors like Paul Kokoricha, managing partner of the private equity business of ACA, and Tokyo-based UNITED Inc., also took part.

Nwobi says Decagon operates at the intersection of edtech, fintech and the future of work, and the funds will be used to scale its efforts on the three fronts.

The company will also be looking to deepen gender inclusion by increasing female participation in its cohorts from 25% (its current stats) to 50% in the next three years.

The CEO adds that the company which he refers to as a “tech talent catalyst” is profitable and growing at 500% per annum.

“We see this capital as fuel to accelerate our mission to transform exceptional people, often from under-represented backgrounds, into world-class engineers by connecting them with financing, in-demand skills and their dream jobs,” he said.

“We’re thrilled to work with Decagon to build up the top 0.5% of vetted engineering talent in Africa and help connect them to global tech opportunities,” partner at Timon Capital, Chris Muscarella, said in a statement.

“The frequency of engineering leaders from US and European companies in our network ask about sourcing African and Nigerian technical talent has increased at a rapid clip, and we’re excited to lean into that and help Decagon on their mission.”

Decagon’s raise comes when there is general skepticism about the viability of tech talent accelerators on the continent despite their apparent need.

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