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BD Insider 234: Creative hub Z-Space faces demolition for Nigeria's coastal road project

Inside: Creative hub Z-Space faces demolition for Nigeria's coastal road project and Nigerian artists' see streaming revenue surge on Spotify.

Overview of some of the facilities affected by the Nigeria's coastal road project

In this letter, we examine:

Demolition of Z-Space
the latest on Nigeria's cybersecurity levy
Spotify earnings of Nigerian artists

We also curated updates on the state of funding in Africa, other noteworthy information and several opportunities.

The big three!

#1. Z-Space faces demolition for Nigeria's coastal road project

The news: Nigerian authorities are set to demolish the soon-to-be-launched creative incubator Z-Space in the coming weeks. This demolition is to make way for the Lagos-Calabar coastal road project, touted as Nigeria's biggest public infrastructure project.

Z-Space is not alone. The controversial project also impacts other facilities, including the $200 million Landmark Beach.

Why it matters: "What we built with @zspacestudios was going to create opportunities for more creators - education, collaboration, exchange programs, capacity development, product, innovation," Adaora Mbelu, co-founder of Z-Space said in a statement seen by Bendada.com. "But here we are, making phone calls to pack up furniture, uninstall fixtures and fittings, salvage what we can because in 7 days our space will be gone. We never got to officially open."

Despite the setback, Z-Space co-founders Mbelu and Karishma Daryani-Chugani remain optimistic. They've expressed hope to rebuild and launch the creative hub in a new location soon.

Context: The Lagos-Calabar coastal road is a planned 700-kilometer superhighway stretching from Victoria Island, Lagos, to Calabar in Cross River State. The ambitious project is designed to be a 10-lane dual carriageway with a standard gauge train track running down the centre.

Proponents tout the road's potential to boost economic activity by improving transportation links between major coastal cities and fostering trade. However, the project has also generated controversy.

#2. Nigeria puts cybersecurity levy on hold following public outcry

Start here: On Tuesday evening, the Central Bank of Nigeria (CBN) announced a 0.5% cybersecurity levy on various electronic transactions, such as online payments, electronic and mobile fund transfers, point-of-sale (POS) transactions and potentially ATM withdrawals.

The CBN justified the levy to generate funds for the National Cybersecurity Fund, overseen by the Office of the National Security Adviser, as mandated by the recently enacted Cybercrime Act 2024. Penalties for non-compliance were also outlined, with failure to deduct and remit the levy resulting in a fine of up to 2% of the annual turnover of the defaulting business.

However, the cybersecurity levy faced widespread criticism from experts and citizens alike. Concerns ranged from the potential stifling of digital transactions to a lack of clarity on how the collected funds would be utilised. Responding to this public outcry, federal legislators directed the CBN to withdraw the circular outlining the levy on Thursday.

And now: According to The Punch, a local publication, President Tinubu has ordered the central bank to suspend the implementation of the cybersecurity levy policy altogether. This suspension is accompanied by a call for a thorough review of the policy.

A deep dive into President Tinubu's order

#3. Nigerian artists see streaming revenue surge on Spotify

The news: Nigerian music is experiencing a boom on streaming platforms, with artists seeing a significant increase in royalties paid by Spotify in 2023. According to the platform's annual "Loud & Clear" report, Nigerian artists earned ₦25 billion ($16.7 million) in streaming royalties last year, a 127% increase from 2022.

This growth reflects the rising global popularity of Afrobeats, a genre heavily influenced by Nigerian music. Spotify data suggests a 2,500% increase in Afrobeats streams since 2017, showcasing its growing appeal beyond its Nigerian roots.

"The significant growth in royalties earned by Nigerian artists on our platform is a powerful testament to their talent, creativity, and global appeal," said Jocelyne Muhutu-Remy, Spotify's managing director for Sub-Saharan Africa.

According to Spotify, over half of the royalties paid to Nigerian artists in 2023 went to independent artists or labels. This indicates that even without the backing of major record companies, Nigerian artists are finding success on the platform.

Know more: Over 80% of the tracks on Nigeria's daily top 50 charts belonged to Nigerian artists, and listeners discovered Nigerian artists over 950 million times. This surge in popularity is further amplified by the platform's support, with over 1,400 Nigerian musicians featured on Spotify's curated playlists.

The report also highlights the growing influence of younger listeners. Gen Z (aged 18-24) makes up a significant portion of the audience for local genres like Fuji (32%), Highlife (31%), and Igbo Pop (46%). Cities like Lagos, Port Harcourt, and Katsina are leading the way in streaming these local sounds, the report disclosed.

💰 State of Funding in Africa

South African fintech startup Lesaka Technologies has acquired its counterpart Adumo in a $85.9 million deal. The acquisition is subject to shareholder and regulatory approval.

Other deals that took place last week include:

Seamfix, a Nigerian digital identity solutions provider, secured $4.5 million in private equity funding from Alitheia IDF.
Egypt-based fintech Swypex secured a $4 million seed round, led by venture capital fund Accel, with participation from Foundation Ventures, The Raba Partnership and angel investors.
B2B healthcare marketplace Axmed has raised $2 million in seed funding from Founderful Ventures.

📚 Noteworthy

Here are other important stories in the media:

Raenest is profitable and ready to take over Africa: Nearly half a million freelancers and remote workers across Africa rely on this two-year-old startup's product to process tens of millions of dollars monthly.
Binance locked in a standoff with Nigeria: Binance CEO Richard Teng criticised the recent actions taken by Nigerian authorities against the cryptocurrency exchange. Nigeria is one of Binance's biggest markets. Teng claimed that officials demanded a bribe in exchange for resolving the situation.
Chipper Cash makes a comeback in the US: Pan-African fintech startup Chipper Cash is back in business for US users after a two-month hiatus. The fintech was forced to pause its international money transfer services in the country earlier this year due to an issue with a previous banking partnership.
South Africa's e-commerce heats up: The e-commerce scene in South Africa got a major player as Amazon launched its online marketplace last week. This arrival puts Amazon head-to-head with established leaders like Takealot, Temu and Makro.