Grace Ashiru
Peter Njonjo, the CEO of Twiga, a Kenyan startup facilitating connections between farmers and food vendors, declared his intention to embark on a six-month sabbatical from the company last Thursday, triggering concerns that external pressures might influence his departure. This decision follows Twiga’s recent successful fundraising, conducted just a fortnight ago, to settle outstanding debts to suppliers. A previous report by TechCabal highlighted Incentro, a cloud service vendor and one of the owed suppliers, seeking court intervention for liquidation proceedings to compel Twiga to settle its outstanding obligations. Ongoing private discussions persist between the involved entities to resolve the dispute
Twiga, facing financial constraints, secured $35 million in convertible bonds—debt with both interest payments and the option to convert into equity. The funding came from Creadev and Juven, private equity investors who had previously supported Twiga, as revealed by an insider familiar with the deal. The specifics of the funding, undisclosed until now, have not been commented upon by Twiga in response to TechCabal’s request.
Creadev, one of the two private equity firms involved in Twiga’s recent capital infusion, operates as a Mulliez Family Association (AFM) subsidiary. AFM serves as the investment holding company overseeing the wealth of a prominent French family-owned consumer goods conglomerate. Creadev typically allocates investments ranging from $500,000 to $10 million, with the flexibility to provide more considerable sums when reinforcing support for portfolio companies. Juven, the second contributor and a spinoff from Goldman Sachs, adopts a comparable investment approach. This evergreen fund typically invests between $10 million and $30 million. Notably, neither Creadev nor Juven responded to TechCababal’s request for comments.
In private discussions, industry insiders and longstanding figures in Kenya’s tech landscape have conjectured that Njonjo’s sabbatical, occurring a week post a funding injection, could imply an amicable departure orchestrated by investors.
Nevertheless, two informed sources emphasize that Njonjo maintains a strong rapport with Creadev and underscores the investment entity’s continued backing of the business. Startups aiming to digitize the decentralized informal market for fast-moving consumer goods and packaged foods have faced notable challenges.
Twiga recently underwent a significant restructuring, including a 30% staff reduction and a shift in its commercial model. The company closed its in-house sales department in favor of independent sales contractors. Njonjo, Twiga’s spokesperson, expressed confidence in this transformation, citing full support from investors. However, a prominent seed stage investor, preferring anonymity, took a more critical stance, suggesting a potential departure of Peter Njonjo, stating, “I’m 90% certain Peter was fired. This is how VCs are viewing it.” The investor noted that VC firms in Africa are facing challenges amid discussions about Twiga and other struggling B2B e-commerce startups. Economic pressures, including rising inflation and currency devaluation across the continent, have strained economies and impacted consumer spending.
Twiga, despite securing substantial funding, faced challenges in 2023, citing a progressively difficult business environment. A former vendor raised concerns about the firm’s monthly burn rate, given its significant capital infusion of over $150 million in equity and debt since 2017.
Operating on an asset-light model, Twiga didn’t own the trucks or warehouses crucial to its operations, as shared by a former vendor with TechCabal. Notably, more than half of the raised funds (approximately $80 million) were secured in the last three years following the departure of co-founder and former CEO Grant Brooke. His exit was reportedly influenced by diverging views with investors on the company’s strategic direction.
Founded in 2014 by Peter Njonjo and Grant Brooke, Twiga’s core mission is to source fresh produce directly from farmers and distribute it to urban retailers in Kenya. The B2B company boasts backing from investors such as Genevieve Capital, Creadev, Juven AHL Venture Partners, and Omidyar Networks.
