MarketForce Is Africa’s Latest Startup To Conduct Employee Layoffs
MarketForce, a B2B eCommerce startup with a long-term focus on the retail economy of Africa, has severed ties with some 9 percent of its Kenyan workforce, TechCrunch reports.
The layoff, reportedly, was conducted sometime last month in an effort to reorganize the business’ operations in the East African country. About 54 people were laid off from its 600-person team.
It is no longer news that the global tech market is witnessing an invasion of layoffs, as the space tries to adapt to the new normal occasioned by the scarcity of venture capital and fears of a hard-wired downturn. According to layoff aggregator Layoffs.fyi, 508 tech startups have let go of 68,452 employees in 2022, as the global economic uncertainty renders the startup bubble unsettled.
MarketForce was founded in 2018 by Tesh Mbaabu and Mesongo Sibuti, as the duo looked to hatch a panacea to the fragmentation that exists between small local retail shops and their distribution chains. The startup, which operates in the fast-moving consumer goods (FMCG) segment, got accepted into Y Combinator as the only African startup to have made the Silicon Valley accelerator’s Summer 2020 cohort.
Upon graduating from YC in July last year, MarketForce secured USD 2 M in a pre-Series A round counting P1 Ventures, Launch Africa, V8 Capital, Future Africa, GreenHouse Capital, Rebel Fund, and Remapped Ventures as investors, and launched RejaReja—a merchant-focused B2B eCommerce marketplace. A little after this fundraiser, the company bought over Digiduka, a Kenyan digital payments platform, to augment its financial endeavors. In February this year, the venture raised USD 40 M in Series A debt and equity [evenly] to expand RejaReja across the continent.
Having somewhat unexpectedly downsized its workforce, MarketForce joins a handful of African startups that have been adversely affected by the ongoing tech layoff wave, however in an isolated exercise that affects only its home markets. Recently, companies such as SPAC-chasing Swvl, unicorn-level Wave, Sendy, Vezeeta, and [much more recently] Brimore, have laid off employees in an effort to course-correct their operations.
Presently, the startup’s activities in Nigeria, Rwanda, Uganda, and Tanzania are business as usual. At press time, the company is yet to respond to WeeTracker’s inquiry as to the fate of its other markets in Africa, since it is yet in the middle of a drive supposedly necessary to its continental expansion.
MarketForce is one of the companies bringing about a change and more confidence in Africa’s beleaguered eCommerce landscape, a market whose takeoff has been delayed for lack of befitting models. Wasoko, TradeDepot, and Ominibiz also operate in the space, not only proffering innovative solutions to the region’s troubled supply chains but also painting a prettier picture for general African eCommerce.
“The obvious is that 90 percent of consumer purchases in the continent happen via informal channels; the mom and pops and corner shops. That is pretty significant: a market of over 1 billion people buying from these said corner shops. In Africa, B2C eCommerce penetration is still under 2 percent so far, which means we have a long way to go in enabling direct-to-consumer purchasing,” Tesh exclusively explained to WeeTracker last November.
Layoff season continues across the globe, while Africa remains the least affected tech ecosystem in the fold.