Nigerian fintech startup Thepeer, which shut down in April 2024, will return roughly $350,000 to investors despite having runway remaining.
The founders pointed to difficulty achieving product-market fit as the reason for the closure of Thepeer.
Founded in 2021, Thepeer aimed to connect wallets from different businesses, allowing users to move money seamlessly. While the concept was promising, attracting users and integrating with businesses proved challenging. The company generated minimal revenue, less than $1,000, despite processing over $500,000 in transactions during the first three quarters of 2023.
African startups are prioritizing the responsible use of investor funds and Thepeer’s founders opted to return capital, representing approximately 15% of the $2.3 million raised, rather than pursue a potentially risky direction with investor money. This decision contrasts with the more common approach of “hustling” to survive, which can sometimes lead to a complete loss of investor funds.
Several factors contributed to Thepeer’s struggles. The African market may not yet be ready for large-scale wallet-to-wallet transactions. Compliance issues and a lack of consistent support from fintech partners further affected their efforts. Additionally, established payment companies like Paystack and Flutterwave were strong competitors.
Finding product-market fit is very important, and sometimes an early shutdown can be the most responsible outcome for both investors and founders. While the market for wallet-to-wallet transactions may hold future potential, Thepeer’s experience drives a different direction, with factors like market readiness and established competition being highly key.
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