Troubled e-commerce start-up Copia suspends operations in six Kenyan cities

Troubled Kenyan e-commerce startup Copia has halted operations in six cities due to the financial crisis that saw it go into administration just last month.

Failure to secure additional funding has left one of Kenya’s best-funded startups facing financial constraints, forcing it to take drastic cost-cutting measures over the past few weeks.

As a result, the consumer business (B2C) company has discontinued services in Naivasha, Embu, Kericho Machakos, Meru and Eldoret as of May 29, according to an internal communication to employees.

Warehouse workers serving these markets have been furloughed pending further guidance, and the company says it still hopes to resume services in affected areas, although without specific schedule.

Copy provides a platform for rural, middle and low-income consumers to order products delivered at their convenience by agents.

Founded in 2013 by former Silicon Valley champions Tracey Turner and Jonathan Lewisits model includes digitally enabled local agents who act as ordering and delivery points to meet consumers wherever they are, online or offline.

On May 23, the start-up went into administration. This is a process in which an independent person takes control of the company, examines its finances and then recommends further action. This may mean liquidation of the company, its sale or restructuring.

Copia has appointed Makenzi Muthusi and Julius Ngonga of international consultancy KPMG to help rescue the company.

Prior to this move, just a week earlier, it had announced that 1,060 jobs were at risk of redundancy after it opted for a drastic organizational restructuring as part of an effort to raise capital to sustain operations.

At the time, Copia also warned of the company’s impending closure if financial problems persisted, and even gave employees one month’s notice of layoff in accordance with local labor laws.