European Journal of Business and Management www.iiste.org ISSN 2222-1905 (Paper) ISSN 2222-2839 (Online) Vol.17, No.6, 2025 93 Scaling Up SMEs in Nigeria: A Thematic Analysis of Strategic Drivers, Growth Barriers, and Entrepreneurial Insights Aladejebi Olufemi 1* Agbesuyi Kayode 2 1. The University of Lagos Business School, Akoka, Lagos, Nigeria (ULBS), Akoka Lagos, Nigeria 2. Faculty of Management Sciences University of Lagos, Akoka, Lagos, Nigeria * E-mail of the corresponding author: oaladejebi.ulbs@unilag.edu.ng Abstract This study examines the strategic drivers, barriers, and sector-specific insights that influence the scale-up of Small and Medium Enterprises (SMEs) in Nigeria. Through in-depth, semi-structured interviews with founders and senior managers from diverse sectors including ICT, garments, renewable energy, and pharmaceuticals this research identifies key factors that enable and constrain business growth. The findings reveal that internal business strategies such as visionary leadership, innovation, service quality, and operational adaptability are crucial to scaling in Nigeria’s volatile environment. However, external barriers, particularly limited access to capital, macroeconomic instability, and regulatory challenges, significantly impede scale-up efforts. While some respondents acknowledged the benefits of certain policies like tax exemptions, inconsistent implementation and regulatory delays remain pressing issues. The study also highlights the broader economic contribution of SMEs, including job creation, tax compliance, and support for smaller businesses. The research concludes with practical recommendations for improving financial access, streamlining regulatory processes, and fostering innovation within the SME sector. The findings offer valuable insights for entrepreneurs, policymakers, and future researchers aiming to enhance SME growth and economic development in Nigeria. Keywords: SME Scale-Up, Strategic Drivers, Barriers to Growth, Nigeria, Entrepreneurial Insights DOI: 10.7176/EJBM/17-6-07 Publication date: July 30 th 2025 1. Introduction Small and Medium Enterprises (SMEs) are at the centre of economic growth in emerging as well as advanced economies. It is a well-known fact that they are drivers of job creation, innovation, and inclusive development (Adeosun &Shittu, 2022). In Nigeria, with its structural unemployment and high informality rates, SMEs constitute more than 80 percent of the total number of businesses and are the major contributors to national production and employment (Cahyadin et al., 2024). However, it is a minor fraction of these businesses that manage to grow to the magnitude of high-growth companies that can deliver prolonged economic transition (Audretsch, Belitski, &Theodoraki, 2024). The empirical and policy challenge is to understand the mechanisms which facilitate or inhibit this process of scale-up. Scaling, in this context, refers not merely to business survival or incremental growth, but to a deliberate transition toward larger operational footprints, broader market reach, diversified offerings, and formalized internal structures (Monteiro, 2019). High-growth SMEs, often referred to as “scale-ups,” exhibit a different trajectory from conventional firms by achieving rapid and sustained expansion in sales, employment, or assets. The capacity to scale is particularly salient in the Nigerian context, where macroeconomic volatility, infrastructure deficits, and institutional bottlenecks compound entrepreneurial uncertainty (Aluko et al., 2024). Scholars have therefore emphasized the need to interrogate both firm-internal and external conditions that influence scale-up performance in such environments (Slávik et al., 2024). It is indicated in the literature that scaling is not automatic or linear. Although access to capital, innovation capacity, and managerial competence are commonly mentioned as the key enablers (Faloye et al., 2021; Belitski et al., 2023), some researchers also refer to the role of contextual dynamics, such as sectoral regulation, labor market flexibility, and digital readiness (Wongyai et al., 2025; Lange et al., 2023). Nigeria is one of the countries where an intervention like the Nigeria Start-up Act 2022 has been proposed to jumpstart tech-enabled entrepreneurship and scale-up ecosystems (Adelodun&Daibu, 2023). Still, a gap between policy intention and entrepreneurial performance continues to exist, in particular with regard to non-digital or non-capital-intensive firms. Despite an expanding body of research on SMEs in Nigeria, there is limited empirical exploration of the lived experiences of scale-up entrepreneurs across diverse industries. Existing studies often rely on quantitative surveys or macroeconomic proxies, which may obscure the complex, path-dependent, and sometimes nonlinear