Kenyan B2C e-commerce platform Copia has stopped its delivery service in six towns after entering administration in May 2024.
Financial Challenges
Copia has faced significant cash flow problems, leading to administration and a halt to new orders from Central and Eastern Kenya.
Despite receiving $123 million in funding, Copia has been unable to achieve profitability.
Similarly, the company’s attempt to expand into Uganda ended in closure after a year, hindering its pan-African ambitions.
Restructuring Measures
Copia appointed administrators Makenzi Muthusi and Julius Ngonga (KPMG) to manage operations, explore turnaround strategies, and secure new investments for the Kenyan business.
To preserve cash, Copia has suspended deliveries in six towns: Naivasha, Machakos, Meru, Embu, Kericho, and Eldoret.
“We regret that we have to stop serving these locations at this time as we resize and reshape the business, but we expect that we will in the future return to these areas,” said an email from Copia’s Director of Human Resource, Ann Mwihaki.
Over 1,000 employees were laid off in May due to cash flow issues.
Copia initially aimed to transform informal rural kiosks into a digital retail platform connecting customers directly to FMCG (Fast-Moving Consumer Goods) manufacturers to reduce product costs.
Copia was previously well-supported by venture capitalists, including US’s DFC and GoodWell Investments.
“As a follow-up to our previous communication on the administration process, as a reminder, the objectives of the administration are to maintain the company as a going concern, and the administrators continue to work with management to raise capital from new investors for the Kenya business,” Mwihaki added.
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