By the end of March 2025, four African technology companies had reached very different versions of the same uncomfortable point. Lipa Later had entered administration. Bento Africa had suspended operations. Edukoya had wound down, while Joovlin had closed.
Taken together, they became four of the most visible examples of African startups in crisis in 2025. But putting them all under the same explanation would miss what actually went wrong.
Their problems were different. It varied from debt pressure, questions over operational controls, a market that could not support the product at scale, to revenue that failed to catch up with usage.
African technology companies went on to raise $4.1 billion in equity and debt in 2025, according to Partech, 25% more than the previous year and the strongest annual total since 2022. Equity funding reached $2.4 billion, while debt rose to a record $1.6 billion. Capital was available, although investors had become more selective about where it went.
The four companies that ran into trouble in the first quarter therefore tell a more useful story than a simple shortage of money.
4. Lipa Later (Kenya)
Lipa Later had spent years building one of East Africa’s better-known buy-now-pay-later businesses.
Founded in Kenya in 2018, the company raised $12 million in a mix of equity and debt in January 2022. At the time, it planned to deepen its presence in Kenya, Uganda and Rwanda and enter markets including Nigeria, Ghana and Tanzania. It later raised another $3.4 million in debt financing in 2023.
Expansion was not limited to new countries. Lipa Later acquired Kenyan e-commerce company Sky.Garden in 2022. The company later put the transaction at KES250 million when it relaunched the platform the following year.
By March 2025, the financing picture had changed. TechCabal reported that the company had struggled to secure fresh funding and was having difficulty meeting obligations to employees and suppliers. On March 24, administrator Joy Vipinchandra Bhatt of Moore JVB Consulting took control of the company. Kenya’s official gazette confirmed the appointment.
Administration is not the same as liquidation. It gives an appointed administrator control of the company while its finances are assessed and a route forward is determined.
That distinction matters. So does Lipa Later’s financing structure.
Credit businesses consume capital. Expansion consumes more. Debt adds obligations that remain whether the next funding round arrives or not. Lipa Later had raised substantial sums and expanded across markets, but failed fundraising left less room to absorb financial pressure.
Its case was not simply a startup failing to raise another round. It was a warning about how quickly growth becomes a balance-sheet problem when liquidity tightens.
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3. Bento Africa (Nigeria)
Bento’s problems were different.
The Nigerian company handled payroll, tax and pension processes for businesses. That put it in a particularly sensitive position. Customers were trusting Bento with money they owed employees and government institutions.
In January 2025, the company faced allegations that taxes and pension deductions collected on behalf of clients had not been properly remitted. The Lagos State Inland Revenue Service and the Economic and Financial Crimes Commission were investigating allegations involving tax receipts, pension payments and other discrepancies. Founder and chief executive Ebun Okubanjo disputed allegations against the company.
Several clients had already cut ties with Bento, according to reports. Then the internal operation began to fracture.
Okubanjo resigned at the end of January. Bento’s engineering team was laid off following a dispute over unpaid salaries. Payroll processing was disrupted. In February, the board told customers to stop funding payroll accounts while the company temporarily suspended operations and worked through outstanding obligations. Some staff were brought back to help clear the backlog.
This was not principally a venture-capital story.
A payroll company can survive an awkward product launch. It cannot easily survive customers losing confidence in whether salaries, taxes and pensions will arrive where they are supposed to go.
For Bento, governance and operational control were inseparable from the product itself. Once those controls became the subject of serious questions, the commercial damage followed quickly.
2. Edukoya (Nigeria)
Edukoya had something many startups spend heavily to acquire – users.
Founded by Honey Ogundeyi in 2021, the Nigerian education technology company raised $3.5 million in pre-seed funding that year, then a record for an African edtech company at that stage.
Its numbers showed real use. More than 80,000 students had used the platform, more than 15 million questions had been answered and thousands of live classes were taking place each day, according to a company communication reported by Techpoint Africa.
The problem was beneath those numbers.
Edukoya said poor connectivity, limited access to devices, low disposable income and broader economic conditions made its synchronous learning model difficult to scale. It explored partnerships, mergers and changes to the business before deciding to shut down and return remaining capital to investors.
That makes Edukoya one of the more useful cases in the group because it did not simply exhaust its cash.
The company had evidence that students would use the service. It did not have enough evidence that the market, at that point, could support the service at the scale required by a venture-backed company.
User growth measures interest. A business still needs customers who can pay enough, often enough, to cover the cost of serving them. In consumer businesses aimed at households under income pressure, that gap can be decisive.
Edukoya chose to stop before spending all of its remaining capital trying to close it.
1. Joovlin (Nigeria)
Joovlin had neither Bento’s regulatory controversy nor Lipa Later’s financing complexity.
Its problem was more familiar.
The Nigerian startup built tools for small suppliers and retailers selling through social platforms. Businesses could manage inventory, orders and online storefronts from one system.
By 2022, Joovlin said it had more than 2,000 active resellers and over 6,000 products listed by suppliers. It had also received $100,000 in pre-seed funding from MEST Africa.
The company closed in January 2025.
Joovlin explained that its user base had not grown enough to generate the revenue required to keep operating without outside capital, and attempts to raise more money had failed.
The company had customers. It had a product in use. It had previously raised money. None of those things produced enough cash to keep the business alive once external funding stopped.
For an early-stage company, runway buys time for revenue to catch up with costs. Joovlin reached the end of that runway first.
