About seven years ago, a Nigerian fintech found itself on the wrong side of the Central Bank, what we’d call a proper hot okro soup. It was close to losing its license entirely. The Central Bank had decided to make them walk the straight and narrow. Fortunately, word got to the founders before the letter landed.
A frantic phone call to a well-respected bank executive is what surprisingly turned things around. The man flew to Abuja and went to plead their case in person. No lawyer or press statement or strongly worded appeal came close to doing that. They survived because somebody with the right relationship intervened on their behalf. Nothing in that entire saga carried anywhere near that kind of weight.
Of course, the Central Bank didn’t let them off the hook because some big man strolled in. He offered to ensure the fintech remediate their governance and compliance issues within a short period of time. The license was tied to the banker’s 30 years of pedigree.
I’ve thought about that story a lot over the years, because it captures something founders like me don’t want to admit to themselves. The people who decide whether your business lives or dies aren’t always the investors you’re chasing or the customers you’re trying to win over. Sometimes they’re civil servants sitting in an office you’ve never visited, and most of us never bother to find out who they are until we’ve gone to pull the tiger’s tail.
The power regulators hold and why we pretend it isn’t there
Regulators, for the most part, aren’t wealthy people. There are exceptions in certain countries where regulation has become a racket, but broadly speaking, the people writing and enforcing the rules that govern your industry are bureaucrats earning civil servant salaries.
But man, the power they wield is enormous!
You saw it play out during the last World Cup, when Folarin Balogun’s red card got overturned because somebody knew somebody who knew somebody who knew somebody. Football, of all things, isn’t immune to influence and access. Business is no different, and in many ways it’s far less forgiving.
If these people truly have the power to make or unmake your company, why do so many founders walk around completely disconnected from and oblivious of them? We’ll spend months perfecting a pitch for an investor we’ve never met, but never once think to learn the name of the person who runs the department that could shut our business down with a signature.
By law, regulators exist to write regulation, enforce it, and punish whoever wants to make a monkey out of it. That’s the job description, plain and simple. And yet founders everywhere, not just in Africa, tend to operate as if these people don’t exist. We build our businesses, we chase growth, worry about competitors and product and fundraising, and somewhere along the way we forget that there’s an entire arm of government whose sole purpose is to decide what we are and aren’t allowed to do.
The less you know your regulator, the less you understand how much influence they have over your future. Founders who’ve never sat across the table from the people governing their industry tend to underestimate them badly, right up until the day a new policy lands on their desk and blindsides their entire business model.
The relationship should happen long before you need a favor
As a founder or business owner, you need to be deliberate about knowing your regulators and the people who work under them. This doesn’t happen by accident or through a single courtesy visit. I’ll have you know that it’s a relationship you must build over time, the same way you’d build a relationship with a big-pocket customer or a strategic partner. And there’s nothing illegal or shady about wanting to know your regulator or wanting to understand how they think.
The real risk sits on the other side. Skipping this relationship altogether is the genuinely dangerous position to be in. When you know your regulator and the people around them, you start to develop a feel for the kind of regulation that’s coming down the pipeline.
There’s a lot of noise out there, plenty of rumored policy changes and half formed proposals floating around industry circles, but proximity to the people who write the rules gives you a much sharper sense of what matters and what you can safely ignore. You start to understand which lines you can never cross and which grey areas still have room to move. The point isn’t to test boundaries or try to get away with something. It’s to see the regulator’s thinking clearly enough that you stop operating on assumptions.
I know this because I lived it. I started Open Banking Nigeria in 2017, talking directly to the CBN, no license, no mandate, just a group of fintechs who decided to engage properly. The director came to our events, not once but twice. And before long something funny happened. People across the industry started assuming Open Banking Nigeria was some licensed entity, treating us with the kind of respect that comes with a government stamp. It wasn’t. We were a bunch of fintechs who showed up, did the work, and engaged the regulator the way you’re supposed to. That assumption alone tells you how rare proper engagement is. When you do it, people can’t imagine you pulled it off without a title.
There’s another benefit to this closeness, and it pays off slowly but consistently. When you help a regulator succeed at their own job, you build goodwill that shows up later. And this isn’t bribery in any shape or form. It’s sincerely helping the people responsible for regulating your industry do their jobs better.
Every regulator, at some point, taps into industry expertise to figure out how a new policy might land, or how an existing one is performing once it hits the real world. They rely on input, data, and perspective from the very businesses those rules will affect. Being close to a regulator means you’re in the room, or at least in the hallway somewhere, when those conversations are happening. That proximity gives you the chance to positively influence regulation before it’s finalized, and it also gives you the early warning to prepare for whatever’s coming, rather than being caught off guard when it becomes law.
I’ve watched this play out beyond my own work. There’s a story of bankers who engaged their regulators properly and, in doing so, exposed them to technology the regulator hadn’t fully seen yet. That engagement didn’t just protect the banks. It led to better regulation, and it opened room for the whole industry to grow. That’s the part founders miss. Engagement isn’t only defensive but done well, it moves the regulator forward, and everyone downstream of that regulation benefits.
And this repeats across every vertical. The industries where engagement is poor are exactly the ones where regulation and reality are badly misaligned, where you hear the regulated endlessly complaining about rules that make no sense to them, while doing nothing to sit at the table and shape those rules. The complaint is the symptom. Poor engagement is the disease. Show me an industry at war with its regulator and I’ll show you an industry that never bothered to build the relationship before it needed one.
Not all regulators are the same but you need all of them
Regulators exist at different layers, and if you’re only paying attention to the person at the top, you’re missing most of the picture. There are the young regulators just beginning to build their influence within the institution, the ones who’ll be running departments in five or ten years. There are the current regulators themselves, the directors, the governors, the executive vice chairmen who are actively making decisions today. And then there are the ex-regulators, the ones who’ve left the institution but carry the knowledge of how it all works.
You need relationships with all three groups, and I want to spend a moment on the third one because founders tend to underrate it badly. Ex-regulators are frequently very good at what they did, which is often exactly why they end up building consulting practices once they leave. These are the people who know where the “bodies are buried”, so to speak. They understand the internal politics and the figures that drive decisions inside these institutions. When you need direction, they’re often the ones who can point you toward the right person to speak to, or explain why a particular policy is moving the way it is. They also carry political capital they can spend on your behalf when you need someone to open a door that would otherwise stay shut.
If you’re the kind of founder who prefers to sit alone in your office and avoid all of this, you’re putting your business at serious risk. When new regulations are being drafted, your competitors who’ve done the relationship building will be in the room shaping the language, and there’s a real chance those rules get written in a way that disadvantages you and favors them.
The lines you should never cross
There are things you should never, under any circumstances, even with a gun to your head, do when building these relationships.
Never try to bribe a regulator. It’s wrong, unethical and illegal. Beyond the moral higi-haga, it’s also a fast way to destroy your business and possibly get yourself a cold floor in prison with devilish mosquitoes taking turn on you. So treat this as an absolute line rather than a grey area to be negotiated I beg of you.
Never let yourself become a slave to a regulator either. You’re allowed to have principles, and you’re allowed to disagree with a regulator’s position. When you do disagree, there’s no need for hostility or confrontation, but make your stance known clearly and respectfully. A good relationship with a regulator doesn’t require you to agree with everything they say.
Keep the relationship confidential. Regulators generally don’t want their names circulating in industry gossip, and using their name to build your own credibility is one of the worst things you can do to a relationship built on trust. If the governor of a central bank is someone you know well, that’s not something to be dropped casually in conversations to impress other founders or investors. Sharing those details around undermines the very trust that made the relationship valuable in the first place.
If you’re going to give gifts, keep them modest and ordinary. A good book, something small and thoughtful, nothing more. Don’t attempt to influence anyone with expensive items, designers, or by offering to sponsor their children’s abroad school fees. That crosses directly into bribery, however it gets dressed up, and it’s unethical regardless of the language used to justify it.
Sometimes you want to test an idea before committing resources to it, and you can share that with a regulator hypothetically. You might describe something you’re considering doing and ask, purely as a conversation, what their general stance would be. That kind of exchange gives you a read on the regulatory mood that you’ll never find published anywhere online, and it costs you nothing except the willingness to ask.
So how do you start engaging?
Regulators want to succeed at their jobs too, and many of them are working with limited resources or limited in-house expertise to solve problems that are difficult. Be ready to help. Offer guidance where you have relevant expertise, contribute to reports, support industry events and research that helps them make better informed decisions. Anything you do openly and transparently to help a regulator do their job well is fine, and often welcomed.
The trouble only begins the moment you start doing things behind closed doors, covering costs that should never be covered, or slipping into arrangements that blur the line between support and influence peddling. Keep everything visible, keep everything above board, and the relationship will serve you far longer than any shortcut ever could.
Building trust with the people who regulate your industry takes time, and it won’t show up as a line item on any growth chart you present to your board. The founders who treat this seriously instead of something only reserved for crisis moments end up with a seat at the table when the rules of their industry are being drafted, while everyone else finds out about those rules the same way the rest of us find out about a World Cup decision, after the fact, with no say in how it went.