Copia Kenya has issued a warning to its employees about potential job cuts and a complete shutdown due to ongoing financial difficulties.
In a memo dated 16th May 2024, the company told its employees that its exploring all avenues to secure additional funding but remains at risk of reducing its workforce or ceasing operations.
The memo disclosed that the company is in a challenging financial position and there is dire need for drastic organizational restructuring.
“Despite our best efforts to navigate this challenge, we find ourselves in a position where we must consider a far-reaching organizational re-structuring to ensure the sustainability of our operations,” the memo read in part.
Copia has warned that approximately 1,060 roles could be eliminated, with affected employees receiving one month’s notice as mandated by Kenyan labor laws.
The company’s journey in its operation in Africa has not been a smooth one raising various questions. Copia raised $50 million in a series C equity round in 2022, which boosted its total venture funding to approximately $83.5 million since its inception. A year later, the company exited the Ugandan market citing a strategic shift to focus on its foundational business in Kenya amidst economic downturns.
In July 2023, the situation deteriorated when Copia Kenya laid off about 25 percent of its workforce due to the same economic pressures.
In a bid to turn around its fortunes, Copia launched a campaign to increase sales through its mobile app, signalling a pivot in its business strategy amid the challenging economic climate. At this moment, the company had raised a total of $107 million in 7 funding rounds.
Today, things have taken a turn for the worst as the company is pushing more employees out, and hinting at a possible shutdown.
Despite receiving substantial capital injections totaling $107 million across multiple funding rounds, Copia now faces the alarming prospect of shutting down its operations. This hints at potential flaws in operational execution or an inability to effectively adapt to the evolving market conditions.
