Nigeria-based media company IROKO has big plans to go public in the next year on the London Stock Exchange Alternative Investment Market.
Founded in 2011 by Jason Njoku and Bastian Gotter, IROKO is a West African film streaming service that showcases an extensive catalog of Nollywood film content. It was rumored that the company planned to go public back in 2019, but after a few mishaps and having to weather business through the coronavirus pandemic, talks of IROKO going public are back on the table.
“What we can achieve in private, we can equally achieve as a public company. We will likely open up the IPO to our loyal members too so they can capture the value too, which I am super excited about. One thing about IROKO is that we have always been pioneers and we’re okay being super experimental,” Njoku told TechCrunch. “I plan to open-source the entire process so any other African company coming behind — if we’re successful — will benefit from our experience.”
This is such a big step for the company coming off of a tumultuous year filled with unpredictable situations. Last year, IROKO experienced a 70% drop in subscription numbers as its African and Nigerian customers were trying to limit personal spending as they spend more time indoors on lockdown. As a result, 28% percent of the company’s staff went on unpaid leave in May, TechCrunch reports. Njoku was forced to lay off 150 staff members in August due to regulatory reasons and the devaluation of the naira currency.
Despite the drop in subscriptions locally in 2020, the company’s international following grew by 200% — mainly in the U.S. and U.K regions. IROKO took note of this and started focusing on its international markets, increasing its subscription price from $25 to $60 a year and halting marketing efforts in Africa. Njoku told TechCrunch that this helped financially cushion the company as it gears up for growth plans this year.
“The costs of pursuing Africa growth is what was really resized dramatically” he told TechCrunch. “We pulled back to focus on where our economics actually makes sense. Our international business organically grew double-digit in 2020 and we expect it to continue this way for the foreseeable future.”
You’re probably wondering why IROKO is trying to go public on the London Stock Exchange, right? This is because historically African stock exchanges haven’t listed early-stage tech companies often. Njoku said he’s hoping to list IROKO public with a company valuation between $80 million and $100 million.