After dismissing over 1000 employees, Copia Global stops taking orders in six Kenyan markets

·
June 5, 2024
·
2 min read
Copia Global
  • Copia Global, a Kenyan eCommerce platform for online shopping, has temporarily suspended orders from several Kenyan markets.
  • The six affected markets in central and eastern Kenya are Naivasha, Machakos, Meru, Embu, Kericho, and Eldoret. Meanwhile, employees in these markets have reportedly been placed on leave.
  • This decision comes just a week after the B2C firm went into administration and appointed Makenzi Muthusi and Julius Ngonga of KPMG, an audit and advisory firm, to oversee the process.

A company enters administration to save a viable business that is insolvent due to cashflow issues, which entails appointing an administrator to manage the process.

The startup had 1,800 employees and over 50,000 agents across Kenya's western, Nyanza, central, and eastern regions. The administrators reportedly reduced Copia's markets to conserve cash as the company seeks new investors. 

Per a report, Anne Mwihaki, Copia's director of human resources, informed employees that the company would notify external stakeholders, agents, customers, and transporters about the development.

Mwihaki said, “As a follow-up to our previous communication on the administration process, as a reminder, the objectives of the administration are to maintain the company as a going concern, and the administrators continue to work with management to raise capital from new investors for the Kenya business.”

Advertisement

Furthermore, one of the administrators, Makenzi Muthusi, informed employees that despite the delay in May payments due to incomplete bank processes, the company had sufficient funds to cover the period. 

Before entering administration and suspending orders in some markets, Copia Global laid off over 1,000 employees due to funding issues, citing "uncertainties." The company also stated that it may close if the headcount reduction was insufficient.

The layoffs, intended to help cut costs, came five months after the firm announced a $20 million Series C extension round in December 2023. Moreover, the company has raised over $120 million across seven venture funding rounds.

This is not the first time Copia has shut down markets and laid off employees. After launching in Uganda in 2021, Copia suspended operations there in 2023 and laid off up to 700 employees to focus on Kenya due to the "economic downturn and constrained capital markets."

Despite efforts to increase sales through a campaign for its mobile app in November 2023 and funding in December — even a partnership with Visa — the company still laid off employees, went into administration, and is now suspending orders in six Kenyan markets.

Join over 3,000 founders and investors

Subscribe to the Equity Merchants newsletter and start receiving tips and resources for startup success.
Equity Merchants form

Give it a try, you can unsubscribe anytime. Privacy Policy.

The suspension of orders in these six markets raises the question of whether it will help the company cut costs or reduce cash flow.


Got a tip? Our journalists are ready to dig deeper. Please share your insights and information and help us uncover the stories that matter.

Other Stories

43b, Emina Cres, Allen, Ikeja.

 Techpremier Media Limited. All rights reserved
magnifier