In 1917, the largest publicly traded company in the United States was US Steel. Fifty years later, in 1967, the largest recorded was IBM. Over those fifty years, American leading companies had transmuted from building and construction infrastructures to digital infrastructure companies. Before those, food companies were dominant. Today, the largest US publicly traded companies are knowledge companies like Apple, Google* and Microsoft.
Simply, the US has moved from fundamental infrastructures to creating wealth on numbers (yes, data). I expect in 50 years for the leading companies to become dynamic data companies, firms built on AI, autonomous systems and other constructs , unbounded by pure human capabilities.
In Nigeria today, we are at the phase of that 1917 and 1967. Food, building, construction and digital infrastructure firms like MTN, Nestle and Dangote Cement dominate our stock market.
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Looking deeper, the knowledge era has not arrived at scale in Nigeria. It will come, but it may take a few more decades looking at the unfolding paralysis, since the companies which will anchor that future are not even Nigerian even though they do everything in Nigeria. Yes, they are legally Delaware (USA) companies with most operations in Nigeria. That is Nigeria’s lost economic future, and will be more devastating than the impacts of dried crude oil wells. The nation must solve that problem urgently.
All data from Nairametrics.
Nigeria’s top ten MVEs had a combined market valuation of N21.1 trillion or an equivalent of $47.5 billion assuming the official exchange rate of (N445/$1).
Among them are 5 stocks worth over one trillion which we term SWOOTs at Nairametrics.
Combined the SWOOTs are worth about N18.1 trillion or $40.7 billion or a whopping 70% of the total market cap of $58.3 billion.
The SWOOTs are Airtel, Dangote Cement, MTN Nigeria, BUA Cement, and BUA Foods.
Companies are often revered when they attain unicorn status, which means they are worth over $1 billion.
Based on our data and using the official exchange rate, all but one of the companies on our list are worth over one billion dollars.
Comment on Feed
Comment 1: Africa tried to compete by indigenous decrees, converting foreign companies into African companies. Sadly, it has never worked. Home grown, ability of leadership to look inwards can salvage the continent.
Comment 2: Nigeria has a lot of potentials as long as you are not seeing it from the spectrum of USA. They are different countries with different species of people, cultures and demands. One million usd in Nigeria can do a lot of magic but it is just a pittance in America. With a little tweak our economy will fly. I don’t think things are as bad as people paint. Look beneath the surface and you will see so many opportunities begging to be exploited. The richest guy in my village deals in wood.
This man has virtually bought the whole forest in the community and has a lot of saw mills. He even owns more than 15 filling stations and numerous trucks. How much does it cost to start a saw mill. 10 to 15 thousand usd can start one. I know people who are into sand dredging and they go inside the interior villages to buy their waterside for peanuts and sell the sand for insane profits. When I started my sand dredging business nobody thought I could do it because it’s dirty work. Everyday I wear my short and slippers and enter the jungle, when you see me on the road you won’t believe that I have seen 1m. That biz can comfortably give you 500 thousand naira daily if you have your own trucks. Next target is buy an excavator soon and buy a burrow pit.
Comment 3: Good analysis sir. It is very impactful and targeted. Research, training & development should attract dedicated funding, and societal reasoning should be conscientized towards this understanding.
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We are working to build large companies that are truly Nigerian, it’s not going to be easy but it has to happen. It is not only the startups we are losing, our music industry is gone too, or you are not aware of what has happened there? Nollywood is going too, everything is gradually becoming foreign owned.
The main challenge has been funding, we do not have many Nigerians who can or are willing to fund modern companies, so in the desperation to get a great idea going, everything is giving away.
Our people are more comfortable acquiring a plot of land for N200 or N300 million, but how many of them are willing to give out even N50 million to a startup? Aside from bragging right, how economical is it to purchase a plot of land where you just want to build a residential house for half a billion naira? We have an ego problem, and our priorities are never nuanced.
With the new trend of relocating and sending kids overseas, we are setting ourselves up for a future we will not be able to defend our past choices, because you cannot be adding fuel to the very fire that is burning you and still expect it to quench.
We still have some windows to reverse things, but we must be intentional about it.