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    WorkPay raises $2.7million Pre-series A Funding to Expand its Services across Africa

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    ThriveAgric selected West African Winners of the AYuTe Africa Challenge, receiving $1 million.

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    Yebo Fresh raises $4.5 million to Supply Fresh Food in South Africa

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    Sky.Garden survives Shutdown, gets New Owners

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    Flutterwave debunks Alleged Reports of Hacked Accounts

    Flutterwave debunks Alleged Reports of Hacked Accounts

    WorkPay raises $2.7million Pre-series A Funding to Expand its Services across Africa

    WorkPay raises $2.7million Pre-series A Funding to Expand its Services across Africa

    Jumba raises $4.5 Million Pre-seed to Expand the supply of Construction materials in Kenya.

    Jumba raises $4.5 Million Pre-seed to Expand the supply of Construction materials in Kenya.

    Naked secures $17 Million Series B to Expand its Digital Insurance Company in Africa

    Naked secures $17 Million Series B to Expand its Digital Insurance Company in Africa

    PICTDA announces Resumption Date for Code Plateau Cohort

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    Releaf secures $3.3 million Pre-series A funding to improve its Food Processing Technology

    Releaf secures $3.3 million Pre-series A funding to improve its Food Processing Technology

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    Nigeria’s Cash Swap Policy: Goals versus Results

    Nigeria’s Cash Swap Policy: Goals versus Results

    Six Things that could Shape the Northern Nigerian Tech Ecosystem in 2023

    Six Things that could Shape the Northern Nigerian Tech Ecosystem in 2023

    5 Exciting Things That Happened in the Nigerian Tech Ecosystem

    5 Exciting Things That Happened in the Nigerian Tech Ecosystem

    SmallSmall to Expand to Jos following a $3 Million Seed Raise

    SmallSmall to Expand to Jos following a $3 Million Seed Raise

    The Increase in Data Prices is a Big Challenge for Remote Workers in Nigeria

    How Tobiloba Olusola is making Electronic Health Records Accessible to Patients

    How Tobiloba Olusola is making Electronic Health Records Accessible to Patients

  • BLOCKCHAIN
    Binance now accepts Naira Deposits and Withdrawals

    Binance now accepts Naira Deposits and Withdrawals

    Cardano Accelerator Adaverse Invests in Afriguild’s Mission to Onboard Africans Into Web3

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    Is Africa Ready to Operate a Digital Monetary Policy?

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    What Binance and TikTok Star, Khaby Lame’s Partnership mean for Crypto and Web3 Adoption

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    PLA2SMART Set to Lead a New Frontier in Nigeria’s Tourism Economy

    Bundle Launches Web App to Give Users More Accessibility to Crypto

    Bundle Launches Web App to Give Users More Accessibility to Crypto

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    CBN prohibits Foreign Banks from Offering Banking Services

    CBN prohibits Foreign Banks from Offering Banking Services

    Flutterwave adds Google Pay to its Payment Options for African Businesses

    Flutterwave adds Google Pay to its Payment Options for African Businesses

    After Receiving Switching and Processing Licence from CBN, Flutterwave includes eNaira to its Payment Options

    After Receiving Switching and Processing Licence from CBN, Flutterwave includes eNaira to its Payment Options

    Flutterwave gets Switching and Processing licence from CBN

    Flutterwave gets Switching and Processing licence from CBN

    Google Expands its Digital Wallet to South Africa

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    FCCPC Orders Drawdown of Online Credit Companies

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    Naked secures $17 Million Series B to Expand its Digital Insurance Company in Africa

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    PressOne Africa raises $600,000 Pre-seed Funding to Support Entrepreneurs

    PressOne Africa raises $600,000 Pre-seed Funding to Support Entrepreneurs

    ThriveAgric selected West African Winners of the AYuTe Africa Challenge, receiving $1 million.

    ThriveAgric selected West African Winners of the AYuTe Africa Challenge, receiving $1 million.

    Yebo Fresh raises $4.5 million to Supply Fresh Food in South Africa

    Yebo Fresh raises $4.5 million to Supply Fresh Food in South Africa

    Sky.Garden survives Shutdown, gets New Owners

    Sky.Garden survives Shutdown, gets New Owners

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Kenyan foodtech Startup, Kune Shuts Down Months after Raising $1 Million

by Nuel Umahi
June 24, 2022
in StartUps
Reading Time: 5 mins read
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Kenyan foodtech Startup, Kune Shuts Down Months after Raising $1 Million
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Kune – a Kenyan food tech startup that delivered ready-to-eat meals at affordable prices has shut down its operations, affecting 90 of its employees.

The Reasons For Closure

Founded in December 2020 by Robin Reecht, Kune closed down four months after commencing its operations. The startup in June 2021 raised $1 million in a pre-seed funding round and also borrowed an undisclosed amount from a bank in Kenya. Earlier this year, the startup hinted it was raising $3.5 million from local and international investors to ramp up their production capacity.

Announcing the closure of its business, Reecht in a statement said that Kune’s operations were stopped as a result of “economic downturn and investment markets tightening up”.

“With the current economic downturn and investment markets tightening up, we were unable to raise our next round. Coupled with rising food costs deteriorating our margins, we just couldn’t keep going,” he said.

What Seemed to be the Problem

Kune had sold over 55,000 meals and had acquired 6,000 individual customers and 100 corporate customers with the sale of its meal going at $3 per meal. The startup which was a welcome development by Kenyans still had its share of controversy. In June 2021, Reecht was under a huge lash by some Kenyans on Twitter following his interview on TechCrunch where he stated he was inspired to kick-start Kune after taking a trip to Kenya in November 2020 and having trouble getting affordable ready-to-eat meals.

Reecht said, “After three days of coming into Kenya, I asked where I can get great food at a cheap price, and everybody tell [sic] me it’s impossible,”

“It’s impossible because either you go to the street and you eat street food, which is really cheap but with not-so-good quality, or you order on UberEats, Glovo or Jumia, where you get quality but you have to pay at least $10”, he added.

Aggrieved by his comments, Kenyans voicing their critiques alleged that Reecht’s ability to secure funding so quickly was due to his white privilege rather than his business plan, which some believed aimed to solve a non existent problem. The conversations around Reecht’s statement gave rise to a broader conversation about white privilege and favouritism in tech, as well as Kenya’s neglect of its local founders.

The Rise and Fall Of African Startups

Speaking to Kune’s investors, Reecht said, “Not only did you invest in Kune but you gave us your time, brain-width, connections, and emotional support. I am deeply sorry that Kune’s vision didn’t come true. To betray your confidence is something for which I will never forgive myself.”

Despite the budding strides shown by African startups in the past years, a combined analysis by Business Insider and Business Lite Africa revealed that 11 startups closed their operations between 2021 to 2022. These startups jointly raised $3.6 million dollars within the first few years of their existence.

The startups had 80% of them having an all-African led team with 20% of them having a mix of whites and Africans. This is showing the shutdown rates for startups on the African continent between 2010-2018 at 54.20%.

Further, the analysis showed that Ethiopia (75%), Rwanda (75%) and Ghana (73.91%) were among the countries that experienced the highest shutdown rates amongst startups while Nigeria – among prominent startups hubs in Africa – witnessed maximum shutdowns at 61.05%, followed by Kenya at 58.73% and South Africa 54.39%.

The reasons for most of their shutdowns were attached to onerous terms and conditions of investors, harsh business environment, adequate funding and poor internet infrastructure.

Going forward, the African continent requires remedies to the highlighted issues raised to fit a more robust ecosystem moving forward.

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