The Copia Global board of directors has put the eCommerce platform into administration in a bid to keep the company as a going concern.
The Company indicated that it had hired Makenzi Muthusi and Julius Ngonga of KPMG to lead an administration process.
Copia Global said this in a statement, ‘’Copia Global, the parent company of Copia Kenya, was unable to attract capital on terms that were amenable to all existing stakeholders, funders and investors. Copia Global is now winding down, leaving the Copia Kenya business in a new position to raise capital directly. The Administrator will work with management to raise capital from new investors for the Kenya business.’’
Under the Administrator, the company indicated that the Copia Kenya management team will implement a plan with a lower burn rate, an accelerated path to profitability and a focus on the increasingly digital consumer.
The move is of course expected to affect a huge chunk of its employees which the company say is necessary. Tim Steel who is the CEO indicated that affected employees would leave after a month in line with the required notice period.
The startup has so far raised around $123 million across eight funding rounds but says the capital markets environment has been extremely difficult in the last two years, with a significant reduction in capital flowing into Africa generally and the e-commerce space specifically.
In July last year, the company laid off 25% (around 350 members) of the permanent workforce. This came just a few months after it sent home another 50 employees. In April, the same year Copia announced that the economic downturn and constrained capital markets had forced it to suspend its African expansion plans. The move saw the firm even suspend its operations in Uganda just a few months after entering the country.
Founded in 2013 by Silicon Valley veterans Tracey Turner and Jonathan Lewis in Kenya, Copia was the first mobile retail platform built with the potential to serve 750 million middle to low-income African consumers. The startup leveraged a network of digitally enabled local agents to connect with customers in the manner of their choice, including in person, by phone, text messaging, USSD or smartphone app.