Editor's note (October 26, 2022, 6:32 AM WAT): This article has been updated to reflect that the statement sent to Techpoint Africa by someone who claims to be the company secretary for Kloud Commerce is unverified. The statement did not have a signature to confirm that it was infact sent by the board.
- According to a statement received by Techpoint Africa, allegedly from Kloud Commerce's Board of Directors, the allegations of financial impropriety levelled against the company's CEO are unfounded rumours peddled by a SAFE investor.
- The statement, however, admits that there had been disputes between the co-founders sometime in Q1 of 2022.
- However, it's unclear that the supposed statement is actually from the Board, and there was no signature backing the letter sent to Techpoint Africa. If anything, the report raises more questions than it answers.
Kloud Commerce's Board of Directors has denied allegations of financial impropriety levelled against the company's CEO, Olumide Olusanya (D.O)
On October 20, 2022, an investigative report by WeeTracker revealed that investors drafted a petition alleging that D.O misappropriated company funds. The draft referenced instances such as diverting sums of money invested into Kloud Commerce for personal ventures and burning investor money on expensive hotels and car rentals on dodgy trips outside Nigeria.
However, an unverified statement received by Techpoint Africa stated that D.O has only travelled outside of Lagos State, Nigeria once, to Accra, Ghana, in pursuance of Kloud Commerce's aspirations.
It adds that the allegations were unfounded rumours that a SAFE investor was spreading because of disagreements during the recapitalisation negotiations.
According to WeeTracker, one of the investors said that the relationship between the co-founders had deteriorated due to D.O's attitude.
Interestingly, investors were willing to invest another $250k in the company to salvage the situation. However, the investment was on the condition that D.O step down while the co-founders took the reins.
One investor also said that the company did the recapitalisation to reallocate shares with D.O; however, D.O backed out of the deal, maintaining his role as CEO and allegedly made himself Chairman of the Board.
The unverified statement by the company's Board of directors admits to the fact that there were disagreements between the three co-founders sometime in Q1 2022 about the product go-to-market roadmap. The disputes became apparent after the company missed critical product roadmaps.
By April 2022, an inaugural board meeting was held to resolve the disputes. The resolution was to get more funding to provide the company with additional runway.
The statement also mentioned that a SAFE investor made a recapitalisation offer that included a dramatic dilution of the company's cap table and terms which shareholders disagreed with.
The Board claims it was during this period that the said SAFE investor began spreading rumours and unsuccessfully tried to rally other investors to get involved.
The Board also said that D.O "had unilaterally, voluntarily offered to step down and then completely recused himself from the CEO role, to avoid the personal issues with the said SAFE investor leading to an eventual collapse of the venture. Unfortunately, the interested parties could not reach an amicable resolution around the terms of the recapitalisation term sheets."
While the statement points at a SAFE investor as spreading rumours of financial impropriety, WeeTracker's investigative piece highlighted more than one investor corroborating the allegations.
The statement did not address allegations of D.O overworking engineers and demanding impossible timelines enforced with aggression. It, however, concludes by saying, "Kloud commerce was established on clear governance principles right from inception. Business ventures fail, that is the nature of entrepreneurship. The Board is grateful for DO's service in spite of this eventual outcome for Kloud Commerce."
It is also important to note that DO allegedly made himself the Chairman of the Board, according to the investigative piece. If the article is anything to go by, the Board's statement might be stating DO's defence.
This is a developing story.