The news:
- African cross-border payments startup, Chipper Cash has laid off employees for the fourth time in one year.
- The company said only a small number of employees were affected by this new round of layoffs.
- This new round of layoffs is coming at a time when many African startups have announced shutdowns.
Chipper Cash”s first layoff came in December 2022, just a year after raising $150 million in a round led by FTX, Sam Bankman-Fried’s failed crypto company.
In the second round of layoffs, the fintech company let go of more than a third — 140 employees — of its workforce. 15% of those let go were Nigerians, from IT to engineering and even leadership.
In the third round of layoffs back in June, key staff, including the company’s COO, Alicia Levine, and Kenya Country Director, Leon Kiptum, were affected.
According to TechCabal, The company laid off 15 people across all departments in this fourth round of layoffs. Chipper Cash told the publication that no roles in Africa were affected.
Paystack also laid off 33 staff outside Africa — Europe and UAE — to localise costs. Shola Akinlade, the CEO, said, “We’re changing our operating model to prioritize locating team members within the markets we serve, to localise costs and get closer to customers,”
While Chipper Cash did say why only staff outside Africa were affected, it said, “we constantly look to ensure we have as much efficiency as possible within our global organisation.”
The publication also reported that Chipper Cash cut the salaries of US and UK staff that are remaining in the company.
The company insists it is doing very well and will be profitable in a few months.
The company’s first layoff came after its leading investor, FTX, shut down after it could not pay back customer funds. Another African company, Nestcoin, which had FTX as an investor, also announced layoffs and a significant loss from its $6.5 million funding due to the crypto exchange’s shutdown.
Chipper Cash also reportedly considered a sale in March this year, after another lead investor, Silicon Valley Bank (SVB) shut down.
Valued at $2 billion, Chipper Cash’s valuation was reportedly slashed by half before FTX’s bankruptcy. Given the startup’s troubles in the past year, it could have lost its unicorn status. Techpoint Africa reached out to the startup for more details on the layoff but hasn’t gotten a response.
