Lipa Later, one of Kenya’s most well-funded tech start-ups, has been placed under administration amid undisclosed financial difficulties. The buy-now-pay-later (BNPL) platform, founded in 2018 by Eric Muli (CEO) and Michael Maina (COO), has been a key player in Kenya’s fintech sector, partnering with retailers to enable shoppers to make payments in instalments.
According to a notice published by consulting firm Moore JVB, Joy Vipinchandra Bhatt has been appointed as the company’s administrator effective March 24. The administration process involves an independent party taking control of a company to assess its finances and determine the best course of action—whether restructuring, selling, or winding up the business.
“By virtue of the administration, the powers of the directors of the company in terms of dealing and/or transacting with the company’s assets have ceased, unless with the express permission of the administrator,” the notice stated.
Furthermore, Bhatt directed all creditors of Lipa Later to submit claims against the company by April 23, as part of the administrative process.
Lipa Later had expanded its operations to Uganda and Rwanda and had ambitious plans for further African market penetration. In early 2022, the company raised $12 million (approximately Ksh.1.55 billion at current exchange rates) in a debt-equity pre-Series A funding round to fuel its expansion. Later that year, Lipa Later acquired the struggling e-commerce platform Sky Garden, which was facing insolvency at the time.
In 2023, Lipa Later secured an additional Ksh.500 million through a debt issue. The company also made history by becoming one of the first African firms to receive approval from the U.S. Securities and Exchange Commission (SEC) to raise funds from the general public in the United States.
Lipa Later’s investors have included Cauris Finance, Lateral Frontiers VC, GreenHouse Capital, SOSV IV LLC, Sayani Investments, Axian Financial Services, and Uncovered Fund. The start-up’s placement under administration raises questions about the sustainability of fintech models in Kenya and highlights the challenges facing the BNPL sector.
As the administrator evaluates the company’s future, industry stakeholders will be keenly watching the next steps for Lipa Later and the potential impact on Kenya’s fintech ecosystem.
