Kenyan court reverses order on Wasoko's ex-employees

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June 13, 2024
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5 min read
Retailers who use Wasoko

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নমস্কার,

Victoria from Techpoint Africa here,

Here's what I've got for you:

  • How this company bootstrapped to $20 million a year in revenue
  • Kenyan court reverses order on Wasoko's ex-employees
  • MultiChoice sees subscriber drop and revenue loss

How this company bootstrapped to $20 million a year in revenue

Deimos team
Supplied

Deimos, a completely bootstrapped cloud and cybersecurity company, has seen incredible growth, jumping from $1.3 million in 2019 to $15.2 million in 2022. 

This impressive feat got them a spot on the Financial Times's list of Africa’s Fastest Growing Companies for 2024. But their CEO, Andrew Mori, thinks revenue isn't everything. 

He likes to say, "Revenue is vanity, profit is sanity, and cash flow is king," a principle that’s kept Deimos profitable from day one.

Deimos offers a wide range of tech services, from custom software development to security, cloud-native architectures, and large-scale cloud migrations. 

They’ve got some big names on their client list, like Moniepoint, Kuda Microfinance Bank, Sterling Bank, and even the Central Bank of Nigeria. Mori believes this lineup shows just how good they are at what they do.

For Mori, customers are the real investors in a bootstrapped company. And just like with traditional investors, their resources need to be used wisely. This approach has helped Deimos grow quickly and stay profitable, even outperforming some companies with investor funding.

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Mori’s journey started at Konga, where he was CTO from 2016 to 2018. This role gave him the experience and versatility needed to run a tech startup. He says, "Being in a leadership role at a startup makes you comfortable with a lot of context switching."

READ MORE   Wema Bank lost $595K to fraud in 2023

Curious how Deimos managed to bootstrap to $20 million a year in revenue with a burn rate of $800k monthly? Check out Bolu's story for all the details!


Kenyan court reverses order on Wasoko's ex-employees

Wasoko

A Kenyan court just threw a curveball at Wasoko, a B2B eCommerce startup gearing up for a merger with Egypt’s MaxAB. 

Remember when Wasoko laid off some employees in January 2024? Well, nine employees filed a lawsuit against them for unlawful termination. 

So, in February 2024, the court told Wasoko to keep nine ex-employees on the payroll after they got the boot in December 2023. 

The court initially told Wasoko to keep them on the payroll, but now they've reversed that decision because apparently, the employees didn't give the full story.

Even after Wasoko followed the court's orders and brought the employees back, they didn't come back to work. One of them was even still working there when the court made its first decision! 

The court basically said it's not fair to keep them on the payroll if they're not going to work.

Now, the employees are not happy about this new ruling. They're saying they were allowed to work from home sometimes, but it wasn't easy because they didn't have all the tools they needed, and the office environment wasn't great.

So, now everyone's gearing up for a pre-trial hearing on the employees' wrongful termination suit. 


MultiChoice sees subscriber drop and revenue loss

MultiChoice building

MultiChoice Group has spilled the tea on their performance for the fiscal year ending March 2024. 

They're reporting a whopping R4.1 billion loss for the year ending March 31, 2024, marking their worst financial performance ever. That's a 42% jump in losses compared to last year!

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So, what went wrong? Well, it's a one-two punch: they lost 9% of their active subscribers in places like Nigeria, Angola, Kenya, and Zambia, and got slammed by some foreign exchange rates. 

That combo led to a 5% drop in revenue to R56 billion and a whopping 21% plunge in trading profit to R7.9 billion.

And the hits keep coming – subscriber losses hit all their markets, with both DStv's South African and Rest of Africa businesses taking a hit. To top it off, MultiChoice is now technically insolvent. Their assets shrank to R43.9 billion, while liabilities ballooned to around R45 billion. That's not a good look.

Now, onto the bright spots: Their revamped Showmax platform saw a solid 22% revenue growth to ZAR 1.0 billion ($54.475 million). And their fintech baby, Moment, has been killing it too. They've been processing DStv payments and even raised an extra $22 million in funding, making MultiChoice's stake in it worth a cool $82 million.

MultiChoice is talking up their "resilient" operational performance and promising a turnaround. They're slashing costs left and right, aiming to save R2 billion by 2025.

And they've got some new tricks up their sleeve too – like Showmax 2.0, SuperSportBet, and Moment, all bringing in some cash. CEO Calvo Mawela is staying positive, saying they've laid the groundwork for growth in video entertainment, interactive entertainment, and fintech.


In case you missed it

READ MORE   Canal+ offers to buy MultiChoice for $2.9 billion

What I'm watching

  • Important Medical Questions To Discuss With Your Partner Before Saying I Do
  • Even Healthy Couples Fight — the Difference Is How | Julie and John Gottman

Opportunities   

  • Pitch Friday is tomorrow, Friday, June 14, 2024. Register to attend here or pitch here.
  • Are you a startup founder with at least an MVP? Apply for Founders Clinic, an eight-week mentorship programme connecting early-stage startup founders with experienced professionals. Register here by June 26, 2024.
  • Moniepoint is hiring for 63 positions in the United Kingdom and several Nigerian states, including Lagos, Abia, and Anambra. Check them out here to apply.
  • Explore this website to find multiple job opportunities in Data that align with your preferences.
  • If you are a software engineer, creative designer, product manager, design researcher, or a techie looking for an internship role, please, check out this website.

Have a wonderful Thursday!

Victoria Fakiya for Techpoint Africa.

She's autistic and interested in mental health and how technology can help Africans with mental disorders. Find her on Twitter @latoria_ria.
She's autistic and interested in mental health and how technology can help Africans with mental disorders. Find her on Twitter @latoria_ria.
She's autistic and interested in mental health and how technology can help Africans with mental disorders. Find her on Twitter @latoria_ria.

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