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Nigerian digital bank Kuda is the latest African startup to lay off employees – Technology Flow

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Challenger Bank, based in Kuda, Nigeria and the UK, has joined the ranks of tech companies cutting their workforce in Africa.

Kuda confirmed via email the news of the layoffs, which were first disclosed to Technology Flow by sources, who said it has cut less than 5% of its 450-strong workforce, or about 23 people.

The company numbers pale in comparison to other layoffs in Africa’s tech eco-system over the past few months, particularly among startups that have raised large sums of venture capital in the past year or two; For example, Swvl laid off 400 people; Wave, about 300; 54 Jean, 95; and Vezeeta, 50. However, the event also speaks to the variety of startups — including unicorns and unicorns — that are doing it. Although the company was hiring for designers in July, it’s not entirely surprising in Kuda’s case. According to sources, when Kuda held a town hall meeting last month, cutting redundant roles and laying off non-performing staff to cut costs and expanding the runway in light of the current macroeconomic trends were the topics of discussion.

Meanwhile, last August, Digital Bank, which offers zero-to-minimum fees on cards, account management and transfers and is one of Africa’s Sunnycorns, raised $55 million — which it plans to use only to double down on new services. It was valued at $500 million in a Series B round – for Nigeria but also to prepare its launch into more countries on the continent such as Ghana and Uganda.

The company, which has raised a total of over $90 million from investors such as Valar Ventures and Target Global, plans to expand outside Africa to Pakistan as well. It recently hired Pavel Kristolubov, 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 area and also grow its customer base of more than 4 million.

Kuda is positioned for pan-African and international expansion amid an uncertain venture capital environment, depicting recent cuts in its workforce as part of strategic steps for sustainable growth. “Kuda is currently making some strategic changes to better serve its customers and continue to make financial services more accessible, affordable and rewarding for every African,” the four-year-old company said, citing the reasons for the layoffs.

The email also said that it has affected staff cuts in various departments of the company. According to sources, this will include growth, marketing and production divisions.

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