Communiqué 69: The playbook behind MBO Capital’s bet on Nollywood’s global future

A behind-the-scenes look at how private equity firms like MBO Capital are taking Nigeria’s film industry seriously.

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Keypoints

1. Creative ventures must be structured like real businesses. MBO Capital’s approach to film investment reveals a broader truth for all creative economy players: financial discipline, strong team structures, and clear roles are essential. Vague or inflated budgets, overly centralized control (e.g., one person writing, directing, and producing), and lack of professionalism are red flags to serious investors. Creative entrepreneurs must present their work with the same rigor and transparency as startups in any other industry.

2. Distribution is the new dealbreaker. For investors, content without a distribution strategy is a non-starter. Nollywood’s experience highlights that even great storytelling must be matched with clear paths to market, especially international ones. With the pullback of streamers like Amazon Prime and Netflix from Nigeria, studios that build relationships with global distributors or find alternative international routes (e.g., through regional aggregators) are now best positioned to attract capital.

3. Financial institutions are ready but selective. The emergence of structured funds like MBO Capital’s upcoming film fund and Volition Capital’s VEMA Fund II shows growing investor appetite for creative sector assets, but only when risk is mitigated. Revenue-participation models, proven track records, and tangible licensing deals reduce uncertainty. Creative entrepreneurs must learn to speak the language of investors—unit economics, risk management, ROI—if they want to unlock scalable capital.

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1. Nollywood meets finance

In early April, a curious mix of Nigerian film industry stars and investment professionals gathered in a financial services firm's offices in Lagos for an important conversation: how to make films that make money. Hosted by MBO Capital, a Lagos-based private equity firm, the one-day conference brought together creatives and financiers to unpack the film business in Nigeria.

Unlike the typical glamour-heavy gatherings of Nigeria’s film elite, this event was equal parts business school and industry therapy session. Two standout panels set the tone for the rest of the conference. One, titled "Positioning Nollywood for Profit," brought together voices like BB Sasore of Nemsia Films, Enyi Omeruah of EK 782 Films, and Wangi Mba-Uzoukwu, former Head of African Originals at Amazon Prime, to dissect how to tell commercially viable stories. The second panel, "Looking Behind the Scenes: The Art of Telling the Best Stories," explored the creative process of filmmaking, with contributors like Arie Esiri (Eyimofe), Seyi Siwoku, cinematographer Ola Cardoso (Breath of Life, The Journey of an African Colony), and screenwriter Nicole Asinugo (Living in Bondage 2).

Over the last three years, MBO Capital has quietly built a track record as one of the most active financiers in Nigeria’s film industry. But this event wasn’t about showboating. Instead, it was about knowledge sharing. After several years of investing in Nollywood, the firm has learned what it takes to back a successful production and what red flags to watch out for. Now, it was ready to share these lessons publicly for the first time.

2. A serendipitous start

MBO Capital’s foray into film financing began in 2017, almost by accident. At the time, the firm’s investments focused primarily on sectors like real estate and manufacturing, industries with clear fundamentals and well-understood business models. But then an opportunity arose to invest in a slate of films by Inkblot Productions, a fast-rising film studio out of Lagos. Fresh off the success of The Wedding Party, then Nigeria's highest-grossing movie, the company was looking for working capital to fund its growing slate of productions. For MBO, this was a chance to test the waters.

So, it structured a deal with a revenue-participation agreement, and while the firm declines to share exact returns, it claims it was a financially rewarding partnership. The three films it funded—The Wedding Party 2, Moms at War, and New Money—are on the list of Nigeria's highest-grossing films. But the firm did not invest in more titles until the streaming boom of the early 2020s.