Kenya’s tech ecosystem took a hit as e-commerce platform, Copia Global, is hovers on the brink of collapse after failing to secure fresh funding to sustain operations. The parent company has entered administration, putting over 1,000 jobs at risk and uncertain future for its Copia Kenya subsidiary.
Copia Global has appointed administrators from KPMG to manage the winding down process, the company announced on May 24th. The startup, which has raised $123 million from investors to date, said it was “unable to attract capital on terms amenable to existing stakeholders and funders.”
With the parent entity in administration, Copia Kenya finds itself in a precarious position as it scrambles to directly raise new financing to keep the lights on. However, the prospects look grim given the extensive cost-cutting measures already underway.
In a letter to staff on May 16th, Copia Kenya CEO Tim Steel warned that up to 1,060 employees could face redundancy if a “far-reaching organizational restructuring” is implemented to ensure sustainability. The company had already laid off 350 staff in July 2023 amid economic headwinds.
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Founded in 2013 by Tracey Turner and Jonathan Lewis, Copia pioneered an e-commerce model allowing customers in remote areas to order goods through a network of agents for last-mile delivery. At its peak, it had 1,800 staff and 50,000 agents across Kenya and Uganda.
However, cracks began appearing last year as the capital-intensive business struggled to turn profitable. Copia was forced to close operations in Uganda in April 2023 and shelve ambitious expansion plans into other African markets like Nigeria and South Africa.
The potential collapse of Copia Kenya would be a major setback for the country’s startup scene and e-commerce sector. Along with Twiga Foods, it was one of Kenya’s most capitalized tech ventures, reflecting investors’ initial confidence in its innovative distribution model targeting low-income consumers.
As crushed startups like Copia pile up, concerns are mounting over whether private capital’s funding frenzy in African tech has reached saturation. For founders still standing, delivering profitability is rapidly becoming the overriding priority.