Copia enters administration after a failed fundraising attempt

Copia Global, the B2C e-commerce platform and parent company of Copia Kenya, has gone into administration a week after a TechCabal report revealed the company was considering closure. According to a statement shared with TechCabal, the startup has appointed Makenzi Muthusi and Julius Ngonga from KPMG, an audit and advisory firm, to manage the administrative process.

Copia Global, which raised $123 million in eight rounds of funding, failed to secure new funding, putting its business and more than 1,000 jobs at risk. On May 24, the company announced that the administrator would be working to raise funds for Copia’s Kenyan branch.

“Copia Global, the parent company of Copia Kenya, has been unable to attract capital on terms that are affordable to all existing stakeholders, donors and investors. Copia Global is now winding down, leaving Copia Kenya in a new position to raise capital directly,” Copia said in a statement to TechCabal.

Copia will lay off an unspecified number of employees to “create room for growth,” the company said. On May 16, Copia CEO Tim Steel told employees that more than 1,000 workers could be laid off.

Also as part of cost cutting measures, Copia Kenya will discontinue physical order processing and replace it with an online order fulfillment model via a mobile app.

“In line with the Administrator’s mandate, the Copia Kenya management team will implement a plan to deliver a lower burn rate, an accelerated path to profitability and a focus on an increasingly digital consumer,” Copia said.

Copia was founded by Tracy Turner and Jonathan Lewis in 2013 to enable customers in remote areas to order goods through the platform and have goods delivered to them through a network of agents.

The company said it was struggling to meet its obligations such as paying wages, forcing it to close stores after 10 years. Signs of business difficulties began to emerge in 2023. At its peak, the company had 1,800 employees and a network of 50,000 agents in Kenya and Uganda.

In July 2023, Copia scaled back its operations and laid off 350 employees. At the beginning of the year, employment was reduced by 50 employees, guided by, as the company put it, the desire to maintain low labor costs while ensuring profitability.

Copia also closed its base in Uganda just two years after launching operations in the country and withdrew its ambitious expansion plan that had included operations in Nigeria, Ghana, South Africa and Mozambique.

Copia joins a growing list of well-financed Kenyan companies that have closed shop after failing to raise new capital, such as Wefarm, an agriculture startup connecting farmers with agri-input distributors, and Zumi, a B2B company connecting retailers with suppliers. Others such as Sendy and iProcure are in administration, while Twiga Foods and Markertforce are floundering, hoping for the confidence of new investors.

Copia, along with Twiga Foods ($186 million), is the best-funded e-commerce platform in Kenya.

The shutdown is a big blow to Tim Steel, Copia’s CEO, who took over from co-founder Tracy Turner in 2017. In 2023, Steel told a Kenyan newspaper that he was keen for Copia to succeed.

“I guess I’m afraid I won’t be successful with Copia. We’re not turning it into this billion-dollar company. I put so much time, effort, blood, sweat and tears into this,” Steel said Business Journal in June 2023

*This is a developing story.