Investing in Nigeria from the diaspora: what you need to know

Leaving Nigeria never means giving up the dream of building something at home. For many diaspora Nigerians, the personal desire to invest back home is family-oriented, about creating a legacy, securing future roots, or giving back to a country that raised them.

And yet, investing from abroad is no small feat. It can be empowering or heartbreaking. Strategic or reckless. Rewarding or ruinous. For every success story, there is a tale of money lost to horrible planning, shady middlemen, or naive thinking.

Whether you live in the UK, the US, Canada, or anywhere in the world, investing in Nigeria is a worthwhile endeavor. However, you need to be prepared to overcome many hurdles and shoulder numerous risks.

In this article, I will explain everything you need to know before investing in Nigeria. 

1. Have clear goals

The first and most critical step is to understand why you want to invest. You need a clear reason and a strong motivation. Not just because everybody does, or you have some extra money you want to spend. Think clearly about why you want to invest: for returns through investments, for family support, for retirement in comfort in Nigeria, or to diversify your income?

It doesn’t matter what your reason is; a good reason will help you develop a strategy. Having no purpose will lead you to be easily led astray by trends and family pressure.  

2. Understand the investment landscape in Nigeria

Nigeria has its own rules when it comes to investing, so what works in Canada or the UK might not always work.

Markets are less structured. Information is hardly ever transparent. The contract does not carry much weight. Execution relies on networking rather than systems. If you invest in Nigeria with a Western mindset, then be prepared to be confused, frustrated, and angry.

You need to understand how things work, not just how they are supposed to work. Partner with people who are trusted, experienced, and have some local knowledge and street sense.

That doesn’t mean you need to lower your standards. It does mean that your strategy will need to be adapted to match reality.

3. Your family is not the best business partner

For too many diaspora Nigerians, millions have been sent through relatives, only to end up heartbroken. Projects were abandoned, funds wasted, land never purchased, construction started but never finished, and many more unfortunate stories. This is sometimes due to greed, but more often from inexperience and poor execution.

You may love your family very much, but that doesn’t mean they are business-savvy. Your cousin may be trustworthy, but do they understand budgeting? Do they have experience? Can they be held accountable? 

If a family is involved, that is perfectly fine. But do it the right way. Put everything in writing. Write expectations, track expenses, and request performance reports. Treat it like you would any business deal, not as a favour. For best results, involve professionals if financially feasible. 

4. Real estate is not foolproof

Real estate is where a lot of expatriate cash flows go. Which is understandable, because real estate feels tangible. It’s a long-term investment. It can be a retirement plan. It’s something to show for the hustle. 

But it’s also where so many people lose money. So many things could go wrong: fake land titles, double allocations, properties that are not finished, developers who disappear overnight, agents who lie to close a deal, and friends who manage your building project and steal 30% of the budget. 

Before you put one cent into any real estate project, do the following:

• Confirm titles (deeds) of land (by a lawyer and not on “the seller’s word”).
• Visit the site yourself or send someone so you can get firsthand, unedited video and updates. 
• Register the property in your name. 
• Pay in stages according to project milestones; do not pay all at once upfront. 
• Work with lawyers, not just agents or friends 

Real estate in Nigeria can be profitable, but there are also many traps out there. Your due diligence must be tighter than ever when you are abroad.

5. Explore plenty of investment options

Real estate isn’t the end of the road. There are other avenues of investment that do not entail flying in or building from the ground up. 

You can invest in stocks traded in Nigeria by downloading Chaka, Bamboo, or Trove apps and buying Nigerian or international shares from abroad.

You may contribute to small business financing via a crowdfunding platform or through an investment cooperative, but scrutinize the group well before trusting them. 

Start an e-commerce business selling products made in Nigeria from abroad or doing logistics from Nigeria remotely, or create digital products like online courses, subscription platforms, or service-based websites targeted at Nigerians. 

You could even put some money into agriculture, which should be, of course, only through trusted, traceable systems. That “farm in Kwara” your uncle is running for you isn’t a business plan unless it’s registered, insured, and producing profit you can verify. 

Whatever you choose, make sure numbers make sense and don’t fall for emotional blackmail disguised as “support.” 

6. Pay careful attention to legal protection 

The biggest blunders diaspora investors make are informal: sending money without a written contract and relying purely on understanding. That may do well when all works well, but if the opposite happens, what will happen? 

When you start up a business, register it; buying property also requires registration. Have a lawyer draft an MoU (Memorandum of Understanding). Insist on receipts, invoices, title documents, and every necessary proof. 

Papers protect everyone, even though one trusts the people they deal with. It also affords you legal recourse should anything go wrong. 

You may be abroad, but the same legal system will apply to your investment in Nigeria, so make full use of it.

7. Take into account the exchange rate and economic situation

Let’s face it: Nigerian monetary policy is anything but stable. The naira does not trade in any predictable manner. Inflation gallops ahead of the salary increase. Policies can change at any time. One moment you’re importing goods, the next, customs is holding everything for weeks.

To you, as a diaspora investor, this holds two implications:

• Your foreign currency gives you a comparative advantage: you can afford things many people back home cannot.
• But equally, it means that your prospective ROI may look good in naira terms, but be worth nothing after inflation eats it up

As you consider investment, ask: How does this venture survive devaluation? What if the border closes or policies change overnight?

Make safety provisions and diversify. Do not put all your financial future on one idea, on one country, even if it’s home.

8. Start small, scale slowly

You do not have to send ₦10 million all at once. You do not need to build ten shops in your village or open a factory from abroad. Start small, test, learn, and scale.

The more you test, the more you learn what works. The more you put into practice what you’ve learned, the more confidently you can grow, not out of desperation, but out of research and data.

9. Track your investment

This is one of the most essential elements. Monitor your investment, ask for proof, ask for updates, and stay involved.

Distance should never mean silence. A video call is worth a thousand words. A bank statement speaks louder than someone’s stories. You are not disturbing your business partners by asking questions. It’s your money that is at stake, so you have every right to ask.

And if something does not seem right, then pause and investigate. Rest assured that it’s better to be too careful than to be scammed.

Conclusion

Investing in Nigeria from the diaspora is not for the faint-hearted. It requires caution, bravery, clarity, and connection. You will run into mistakes. You will lose money. You will face disappointment. But you will also build, grow, and hopefully, you will build something larger than yourself.

Nigeria is a difficult terrain. Yet it is also a land of remarkable potential, and if you can walk that path with your eyes wide open, you can flourish.

Start with wisdom. Build with care. And never stop learning.

Because investing from abroad is more than just money. It is about legacy.