Nigerian edtech startup Edukoya, which aimed to revolutionize online learning for K-12 students in Africa, shut down its core operations in February 2025, citing low disposable income and macroeconomic conditions as major challenges. This setback is not an isolated incident, as another edtech startup, Zummit Africa, is currently facing operational difficulties and struggling to stay afloat.

Zummit Africa's CEO and founder, Jonathan Enudeme, revealed that when he launched his business in 2021, he offered free AI services, which garnered an impressive 80-90% intake rate. However, when the startup shifted to a subscription model in 2022, the rate plummeted to 30%. Enudeme attributed this decline to the challenges of raising capital and the target market's struggle to afford basic necessities, let alone additional educational expenses.

The situation reflects the harsh realities edtech startups face in Nigeria, where soaring inflation and a recent 50% telco tariff hike have compelled many families to prioritize 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.

Experts suggest that edtech startups need to adopt more flexible, scalable, and sustainable revenue models that align with the specific realities of Nigerians. Victor Tubotamuno, CEO of Earlybrite, an online educational platform, emphasized the importance of being creative and flexible, offering 'learn now and pay later' options to provide students with access to educational content and resources upfront, while allowing them to defer payment until a later date.

Oluwatobi Akapo, sales director at Edswot, a web-based learning platform, highlighted the need for edtech startups to quickly diversify and maintain profitability through a combination of subscription models and B2B partnerships. Akapo also emphasized the importance of educating governments and public institutions about the potential of edtech startups as a viable solution.

Other revenue models that could work for edtech startups include the freemium model, where users are encouraged to upgrade from a free to a paid version, and licencing educational content, software, or platforms to other businesses or organizations. Business-to-Government (B2G) partnerships, which can reach a large number of students and educators in public education, are also being explored.

Despite the challenges, there is a massive, underserved market in the edtech space, particularly in the public sector. Edtech startups can make a real difference by training public sector officials, improving the quality of education at its core, and bridging the digital divide.

In conclusion, 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.