Chipper Cash, an African cross-border payments company startup valued at slightly over $2 billion, has reportedly laid off many employees.
This comes about one year after the company announced that it had raised $150 million in a Series C round led by Sam Bankman-Fried's now-collapsed cryptocurrency exchange platform FTX, and a few weeks after announcing its acquisition of Zambian fintech company Zoona.
This news was confirmed by the company's VP of Engineering, Erin Fusaro, in a post on LinkedIn. Fusaro stated that while she was not affected by the layoffs, many of her close colleagues and friends were.
She also offered to connect people looking for talent in engineering, technical program management, and IT and encouraged those who were let go to reach out to her for help finding new jobs.
As of today, the company has not issued an official statement on the matter. The exact number of employees affected by the move remains unknown, but it is believed to be a significant portion of the company's workforce.
Chipper Cash offers a no-fee peer-to-peer cross-border payment service in Africa via its app. Founded in 2018 by Ham Serunjogi and Maijid Moujaled, the company's services are used across seven African countries: Ghana, Uganda, Nigeria, Tanzania, Rwanda, South Africa, and Kenya.
In November 2021, six months after closing its first Series C round of $100 million, Chipper Cash announced that it had raised an additional $150 million in a Series C extension round led by the now-bankrupt FTX. This was FTX’s first investment in Africa.
Speculation is that FTX and its sister entity Alameda Research may have required the companies in their portfolio to hold their assets on the FTX exchange as a condition of their investment.
However, if this requirement did exist, it only applied to some companies in their portfolio, as TechCrunch reports that Chipper Cash was not exposed to the collapse of FTX, according to people familiar with the company's dealings with FTX.
Chipper Cash was one of several African startups that have received venture capital from FTX and Alameda Research. Others include African web3 startup Nestcoin, Nigeria- and Kenya-based web3 company MARA; South African crypto exchange startup VALR; Congolese web3 startup Jambo; and Nigerian crypto exchange platform Bitnob.
Last month, Nestcoin laid off employees after FTX's collapse impacted its business. CEO Yele Bademosi shared the news in a tweet, explaining that Nestcoin held assets in the now-defunct exchange to manage operational expenses.
Update: Chipper Cash saw its valuation decrease from $2 billion to $1.25 billion prior to FTX's bankruptcy, as reported by the Financial Times in their coverage of Alameda's venture capital portfolio.