Kenyan agri-tech startup, Twiga Foods, has successfully raised an undisclosed amount of funding from a consortium of investors, featuring notable names like Creadev and Juven. The capital injection coincides with a significant restructuring phase for the company, resulting in the departure of nearly 40% of its workforce.
While the exact financial details remain undisclosed, CEO and Co-Founder Peter Njonjo emphasized that this funding round represents the culmination of a strategic transformation within Twiga. The company’s revised approach and strategy have not only bolstered cost efficiency but also led to improved service delivery for its customers.
Expressing gratitude to both current and former employees, Njonjo acknowledged their contributions amid the ongoing organizational adjustments. The CEO highlighted that the restructuring is a crucial element of adapting to market conditions and fostering a lean, agile, and cost-effective organisational structure.
In August of this year, Twiga Foods implemented a workforce reduction, letting go of a third of its 850 permanent employees, despite having raised Kshs 23 billion over the last decade. Njonjo attributed this decision to challenging market conditions and the company’s commitment to maintaining a streamlined and efficient organisation.
Njonjo explained that Twiga’s cost structure was originally designed with the anticipation of expansion across Africa. However, due to increased interest rates in the US impacting available capital for investments in emerging markets, the company opted for a short-term strategy to sustain operations with a 40% reduction in operating costs rather than increasing prices.
Highlighting shareholder support for the restructuring plan, Njonjo emphasised the company’s commitment to navigate the current economic environment while ensuring customers still have access to affordable goods and services.
Looking forward, Twiga aims to advance its mission of digitising the informal retail economy and revolutionizing food supply chains in Africa. Chairman Hein Pretorius expressed gratitude to investors, employees, suppliers, customers, and other stakeholders for their continued support during this transformative period.
From a strategic standpoint, Twiga Foods’ undisclosed funding signals not just financial support but a robust response to market challenges. The CEO’s acknowledgment of the transformative impact of their approach and the commitment to cost efficiency reflects a well-thought-out strategy that aligns with the evolving demands of the industry. A leaner organisational structure is also crucial for weathering economic uncertainties while maintaining affordability for customers.
