Kuda, the Nigeria and UK-based digital banking platform, has become the latest African tech startup to downsize its workforce, reflecting ongoing cost-cutting measures across the tech ecosystem. The digital bank, valued at $500 million following a $55 million Series B funding round last year, confirmed laying off approximately 5% of its 450 employees—equivalent to about 23 people.
Navigating the Economic Landscape
Kuda’s layoffs come amidst a broader trend of cost reductions by African tech startups, many of which raised significant venture capital funding in recent years but are now contending with challenging macroeconomic conditions. Companies such as Swvl, Wave, and 54gene have also cut hundreds of jobs as part of efforts to extend their financial runway and reduce operational costs.
In Kuda’s case, the layoffs followed internal discussions during a town hall meeting last month, where the need to eliminate redundant roles and address underperformance was highlighted. According to sources, the decision aligns with Kuda’s commitment to sustainable growth while navigating uncertain economic conditions.
Kuda’s Strategic Growth Plan
Founded four years ago, Kuda has gained recognition for its zero to minimal fees on cards, account maintenance, and transfers. The digital bank has over four million customers and has raised over $90 million in funding from prominent investors like Valar Ventures and Target Global.
The bank’s ambitions include a pan-African expansion into markets like Ghana and Uganda and plans to extend its footprint to Pakistan. In preparation for this international push, Kuda recently strengthened its executive team by hiring Pavel Khristolubov, a former Tinkoff executive, as Global Chief Operating Officer, and Elena Lavezzi, formerly with Revolut, as Chief Strategy Officer.
Adjusting to Market Realities
Kuda’s recent staff reductions spanned departments such as growth, marketing, and product development. The bank described the layoffs as part of broader strategic changes aimed at better serving its customers and making financial services more accessible across Africa.
“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 stated in an email.
The Bigger Picture in Africa’s Tech Ecosystem
The layoffs at Kuda are comparatively modest when measured against recent workforce reductions at other African tech startups, such as Swvl’s 400 employees or Wave’s 300. However, the development underscores the financial recalibrations startups are undertaking as venture capital funding becomes scarcer amidst global economic headwinds.
Kuda’s restructuring demonstrates a proactive approach to ensuring long-term sustainability while pursuing ambitious growth goals. With its recent hires and plans for market expansion, the bank remains poised to navigate the challenges and opportunities of the evolving fintech landscape in Africa and beyond.
Looking Ahead
As African tech companies adapt to economic pressures, Kuda’s ability to balance cost management with its aggressive growth strategy will serve as a test case for other players in the region. The bank’s commitment to delivering innovative financial services remains a key pillar of its strategy as it strives to solidify its position in Africa’s competitive digital banking sector.
