Chipper Cash sees dreams beyond Africa crumble

  • $2 billion fintech startup Chipper Cash is burning through its capital as it enacts its fifth wave of layoffs.
  • The latest layoffs see it cull its US and UK presence in favour of Africa, where most of its customers are.
  • The company also suspended operations in the US, time will tell if its UK customers will see the same fate.

As if things could not be getting any worse for billion-dollar startup Chipper Cash, the company has ended its operations in the United States and is now firing its staff in the country, as well as in the UK.

The US-Nigerian fintech was spun up and received portions of its funding in America, and offers international cross-border payments from across Africa and to the US and UK as its main product. The latest layoffs are the fifth the company’s executives have had to enact to preserve profit goals.

The first round of firings came in December 2022, when 15 percent of its workforce was cut, 60 employees mostly from the engineering department.

Now around 20 employees of the startup, which once saw a valuation of $2 billion, based in the US and the UK will be let go as the same roles will be moved to Africa, according to a company blogpost from CEO Ham Serunjogi.

“As we continue executing against our goals and growing our business, I am making the decision to move a handful of our US & UK based roles to being based within some of our African markets such as South Africa, Ghana, and Nigeria,” he wrote last week Friday,

“This change will affect about 20 of our teammates,” he said. Adding “With these changes, we’re now almost profitable and expect to be cash flow positive before the second half of this year.”

Its non-African operations have been suffering for some time as, according to TechCabal, employees it had in the US and UK saw their salaries cut by 25 percent in December. The company also completely suspended its operations in the US but not before telling its customers in the country to urgently withdraw their funds from the company’s app. It said the suspension affected only a “small portion” of its customers, relatively.

“The US has never been a focus for us – we have offered that product there as an extension of our African services,” the CEO told TechCabal.

Despite its once enormous valuation and backing from the likes of Jeff Bezos, the company has encountered challenges amid a slowing global economy, capital burn rate of about $7 million per month, and the drying up of venture capital funding.

Serunjogi expects its US operations to resume at some point soon. The company brought its digital cross border payments to South Africa in 2021, and with renewed focus in Africa – where most of its customer base is – it seems to be attempting to get back on track.

For now, its product is still available in the UK, but this could only be for a matter of time. Chipper Cash helps Africans move money across to family and friends in the diaspora, which includes in the US and the UK. The latter part of this statement may soon be a thing of the past.


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