Kuda, a Nigeria and the UK-based bank, is laying off workers, adding to the growing trend of tech companies trimming their workforce as economic concern grows globally.
The four-year-old company confirmed the development to TechCrunch via email that it is laying off less than 5% of its 450-strong workforce, or about 23 people.
“Kuda is currently making some strategic changes to serve its customers better and continue to make financial services more accessible, affordable and rewarding to every African,” the company said in a statement confirming the development.
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This adds to the global wave of layoffs by tech companies that is gradually reaching every region. In the US, Crunchbase estimates some 32,000 workers in the tech industry have lost their jobs. The companies involved in the layoff include Tesla, Netflix, Coinbase, Robinhood and SoundCloud.
TechCrunch reported that Kuda’s numbers are small compared to other layoffs that have taken place within Africa’s tech ecosystem over the past few months, especially among startups that have raised vast sums of venture capital within the last year or two.
The report referenced Swvl, which laid off 400; Wave, which dismissed approximately 300; 54gene, 95; and Vezeeta, 50. It noted however that the event speaks to varied efforts startups — including soonicorns (soon to be unicorns) and unicorns — are making.
In an earlier report, TechCrunch citing sources noted that Kuda held a town hall meeting last month, where cutting down seemingly redundant roles and dismissing non-performing staff to reduce costs and extending runway were topics of conversation.
This dilutes the surprise that would have come from the news, since the company, as recently as July, hired many designers for its designing department.
However, the layoff came a year after Kuda raised $55 million to expand its services in its current market Nigeria, and also to move to new markets such as Ghana and Uganda. By the fund raise, the digital bank, which offers zero to minimal fees on cards, account maintenance and transfers, took its value to $500 million – making it one of the African soonicorns.
Kuda is understood to be making plans to venture outside the continent with the target country being Pakistan. TechCrunch noted that the company recently hired Pavel Khristolubov, an ex-Tinkoff executive, as its global chief operating officer and Elena Lavezzi, a former Revolut executive in Europe, as chief strategy officer to oversee efforts in this regard and also grow its over 4 million customer base.
Kuda’s layoff underscores the growing struggle by tech companies to stay afloat amidst global economic headwinds. Cutting down on running costs has become a key tool employed by companies to sustain growth. For a young startup like Kuda, which has a future full of expansions to face in uncertain new markets, letting go of staff not contributing enough to the company’s growth is a key way to sustain.
The company told TechCrunch in the email that the layoff affected staff across various departments in the company.