Copia Kenya Announces Restructuring
Copia Kenya Announces Restructuring

Copia Kenya, the e-commerce/fintech platform for mass market consumers in Kenya, announces a significant restructuring of the business. The Company has hired Makenzi Muthusi and Julius Ngonga of KPMG to lead an administration process whose main objective is to maintain the company as a going concern.

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. 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. According to Partech, from 2022 to 2023 African venture capital decreased 46%, participating investors decreased 50% and funding in the ecommerce sector specifically decreased 53%. Meanwhile, debt is an increasing alternative source of capital for African tech startups at more than a third of all capital raised last year.

Under the mandate of the Administrator, 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. While preserving jobs is a key goal through administration, unfortunately a retrenchment of staff will likely be necessary in the near future to right size and right shape Copia to the new digital opportunity and create a position for growth.

While Copia Kenya has been a tech company from day one, it can now transition all aspects of its operations to digital; from the customer interface to agent communications to fulfillment. In the last two years, mobile internet has become more affordable, as illustrated by a recent company survey showing fully 65% of Copiacustomers now have smartphones and can access the Copia consumer app. Mobile connectivity and access to life changing apps is transformative for this underserved community, the last digital frontier.