Copia Global, the Kenyan B2C e-commerce startup that entered administration on May 24, is still a going concern despite layoffs that affected 1,060 employees on Thursday.
Administrators told employees in termination letters on Friday that they aim to continue the business and cut operational costs as the new leadership seeks to raise new capital. Copia appointed Makenzi Muthusi and Julius Ngonga of KPMG as joint administrators on May 24.
“We must ensure the business is right sized and right shaped to meet the new digital business opportunity and position the business for profitable growth. To maximize the potential for Copia to succeed long term, it is necessary to make some difficult decisions regarding its current operations,” said Makenzi Muthusi, Copia’s joint administrator, in a termination letter seen by TechCabal.
“Unfortunately, your employment with Copia Kenya Limited (under administration) will be terminated, effective 7th June 2024. This decision is in no way a reflection of your performance or contributions to the company but rather a consequence of the current circumstances.”
Copia told the employees the company would inform them about potential employment opportunities, signaling the administrator’s commitment to turning around the ailing e-commerce giant. However, it remains to be seen how the new management will convince new investors to inject new capital after similar efforts to save the company collapsed in early May.
The layoffs follow the company’s decision on June 4 to stop taking orders from Central and Eastern Kenya, an indication that the administrators are rolling back operations to arrest cashflow challenges.
Copia Global was founded by Tracey Turner and Jonathan Lewis in 2013 to allow retailers in rural and peri-urban areas to restock essential goods using USSD or a mobile app. It received $123 million in venture capital funding, joining a growing list of firms that have received investors’ goodwill but have struggled to turn on profit.
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Copyright for syndicated content belongs to the linked Source : TechCabal – https://techcabal.com/2024/06/07/copia-global-seeks-fresh-funding-after-this-weeks-layoffs/
