Cowrywise, the Nigerian fintech startup backed by Y Combinator, has made some restructuring of its workforce, resulting in the termination of five positions across the marketing, engineering, and customer success teams.
According to insights from a source familiar with Cowrywise’s operations, the company justified these workforce changes by asserting that the terminated roles no longer aligned with its evolving direction. Describing it as part of internal restructuring and adaptation to evolving business needs, the move sheds light on the dynamic nature of the fintech sector and the company’s vision of staying ahead of the curve.
With a team of 50 employees, Cowrywise, officially confirmed the termination of five roles following an annual performance review, insisting that these adjustments do not constitute layoffs typically associated with economic or business performance concerns, distancing itself from conventional layoff scenarios.
An unnamed insider acquainted with Cowrywise’s trajectory hinted at a transformation, envisioning the company as a “totally different” entity in the coming years, emphasising a shift towards being more of a finance company than a conventional fintech player. The anonymous source’s comments underline the strategic and visionary aspects of Cowrywise’s current decisions.
Affected employees received an atypical exit package, being compensated with three months’ salaries as opposed to the customary one month stipulated in their contracts. This unconventional move raises eyebrows and suggests a departure from the typical practices associated with performance-related terminations.
Founded in 2017 by Edward Popoola and Razaq Ahmed, Cowrywise, a member of Y Combinator’s Summer 2018 batch, has undergone significant growth since its inception. Initially launching with a savings feature, the startup has expanded its offerings, providing diverse investment opportunities to its user base in Nigeria. Noteworthy milestones include amassing over 220,000 users and securing a substantial $3 million pre-Series A funding round led by Quona Capital in January 2021.
Further solidifying its position in the financial sector, Cowrywise obtained a license in 2021 to operate as a fund manager from Nigeria’s capital markets regulator, the Securities and Exchange Commission (SEC). The company’s website asserts 19 SEC-licensed mutual funds for investors to choose from, with at least 20% of the country’s total mutual funds listed on its platform.
