Kenyan startup Sendy lays off 10% of its staff

The layoffs began last month as a reaction to "current realities impacting tech companies globally," according to Mesh Alloys, co-founder and CEO of the company, according to pan-African tech outlet TechCabal.

Mr. Alloys noted that they had been forced to restructure their operations to cut down operating costs, saying “As a result, in July, the company downsized its workforce which affected 10% of our headcount.”

Founded in 2015 by Alloys with his fellow Kenyans Evanson Biwott, Don Okoth as well as American Malaika Judd, Sendy operates an app linking delivery drivers with customers.

The app coordinates contract drivers who own their vehicles while confirming deliveries, creating performance metrics and managing payment.

Some of Sendy’s investors have included local telecoms operator Safaricom, Toyota East Africa and Dutch investor DOB Equity. In a previous interview, the company said half of its staff were in engineering.

In January 2020, Sendy raised Ksh.2.3 billion ($20 million) in a Series B round backed by Toyota Tsusho Corporation. Per Crunchbase, Sendy has so far raised a total of Ksh.3.1 billion ($26.5 million) from 13 investors. 

Alongside the layoffs, the company is reportedly also putting its expansion plans into western and southern Africa on hold. Last year, Sendy said it was seeking to raise Ksh.12 billion ($100 million) this year to expand into Nigeria, Ghana, South Africa and Egypt.

“We will continue to focus on creating solutions for businesses across the continent in line with our mission of empowering people and businesses by making it easier to trade,” Sendy’s statement added.

Sendy is the latest startup to scale down operations amid the ongoing economic crisis that has hit Kenyan startups due to dwindling funding by venture capital firms.

In June, mass transit provider Swvl suspended intra-city rides across Nairobi owing to slowed economic activity witnessed across the country. 

Soon afterwards, Kune Food, the startup that sought to disrupt or innovate the ready-to-eat meals industry in the country through a cloud kitchen, closed down its operations in Kenya altogether, barely a year after its launch.

Kune said it failed to raise funds to keep up operations while keeping its food prices low.