Embattled Twiga Foods secures new funding to settle suppliers
Twiga Foods, a platform facilitating the connection between Kenyan farmers and food vendors, has secured undisclosed funding as part of a business refinancing effort. This development comes just weeks after the company faced a KES 40 million (USD 261,878.75) debt collection lawsuit from Incentro Africa, a cloud services vendor.
The new funding has been obtained from four investors, namely Creadev, Juven, TLcom Capital Partners, and DOB Equity—all of whom participated in Twiga's 2021 $50 million Series C funding round. Twiga's CEO, Peter Njonjo, confirmed the completion of their restructuring and refinancing in a now-deleted Medium article posted two weeks ago.
Njonjo mentioned, “We have sent over 100 letters informing suppliers that we have now finalized our restructuring and refinancing, and they will finally have their long outstanding dues paid.”
In August of this year, Twiga Foods undertook a significant workforce reduction, parting ways with one-third of its 850 permanent employees. Njonjo attributed the decision to challenging market conditions and the company's commitment to maintaining a streamlined and efficient organization adding that Twiga's cost structure was initially designed in anticipation of expanding 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. This strategy involved implementing a 40% reduction in operating costs rather than increasing prices. Looking ahead, Twiga aims to advance its mission of digitizing the informal retail economy and revolutionizing food supply chains in Africa.