The news:
- Nigerian fintech startup Pivo has shut down its operations.
- This news comes one year after the startup raised a $2 million seed.
- The startup was founded in 2021 to provide banking services for SMEs in Africa.
Two-year-old Nigerian fintech startup Pivo has shut down one year after raising $2 million in a seed round that had Y Combinator and VestedWorld participating.
Founded by Nkiru Amadi-Emina (CEO) and Ijeoma Akwiwu (COO), Pivo was billed as a neobank for supply chain businesses in Africa.
According to TechCabal, the startup hasn’t provided any further details about the shutdown.
The $2 million it raised back in November 2022 after a $550,000 pre-seed round completed the same year, was to expand its product offerings.
At the time, it disclosed seeing business accounts grow by 400% and planned to develop solutions for supply chain anchors. Techpoint Africa reached out to the founders, to learn more about the shut down, but there was no response from them at the time of this publication.
Possible reasons behind Pivo’s shutdown
While Amadi-Emina declined to comment on the startup’s shutdown, a few reasons could be responsible for this development. Given Nigeria’s heavy dependence on imported products and its broken transport infrastructure, providing financing for supply chain businesses was always a smart move.
However, the last year has been particularly tough for Nigerian businesses.
In October 2022, the Central Bank of Nigeria announced that it would be redesigning the country’s ₦100, ₦200, ₦500, and ₦1,000 notes. Such decisions are often accompanied by a long implementation time, but Nigerians had roughly three months to comply.
Coupled with a botched rollout of the newly designed notes, many businesses and individuals struggled to access cash.
PoS agents were obvious casualties but many other businesses were significantly affected by the ensuing cash crunch. While it encouraged the adoption of digital payments, it also forced many businesses to close shop.
Ninety-one per cent of businesses had to renegotiate payment structures or dip into their savings to meet obligations as demand for goods dropped, according to a report by research outfit, SBM Intelligence.
Although the currency redesign was halted in 2023, the country has only gotten worse since then. Floating of the naira by the newly elected president has negatively impacted the value of the naira against the dollar, driving up the cost of production for many businesses.
