Source: Business Daily

No fewer than eight Kenyan-born tech start-ups have closed in the last two years, and a ninth appears distressed despite having raised close to Sh35 billion in total investor funding, dampening hopes of the country achieving its Silicon Savannah dream.

An analysis has established that the eight startups collapsed after absorbing a combined total of Sh11.2 billion (in current exchange rates) while agri-tech firm Twiga Foods, which has taken up Sh23.4 billion in venture capital, is presently sending disturbing signals.

Twiga Foods stated last month that it would lay off a third of its workers as part of an effort to cut operational costs by up to 40%, with CEO Peter Njonjo blaming the market for a funding shortage.

The decision was made despite the fact that the company has raised a total of $160 million (Sh23.4 billion) since its founding in 2013.

Whereas most startups blame their problems on a lack of capital, accessible data and interviews with founders suggest that other variables, such as the sustainability of their business models, may be at work in a trend of firms that is slowing the country’s Silicon Savannah dream.

During a side event at the US-Africa Summit in December last year, President William Ruto tried to highlight Kenya’s aim to become Africa’s ICT powerhouse, asking US tech firms to follow the burgeoning investment potential in our country’s Silicon Savannah.

“Our aspiration to uplift millions of livelihoods through technology and innovation now has new impetus,” he said.

Sendy logistic startup, the most recent company to fail, raised the second largest sum of money among the failed companies, totaling $26.5 million (Sh3.9 billion) by October of last year.

In the same month, the company shut down its retail and supplier platform, Sendy Supply, and laid off 20% of its employees.

Sendy’s difficulties were preceded by those of engineering technology firm Gearbox, which lay off three-quarters of its permanent workforce, gave up half of its operating space, and moved to a low-cost business model due to a lack of funding prospects.

According to Crunchbase records, e-commerce portal Zumi, which dealt in non-food items, announced its closure earlier this year, citing a lack of cash after raising a total of $1 million (Sh146.1 million) since its establishment in 2016.

Selected startups and funds raised

Twiga raised $157.1m (over Sh20 billion).

Source: Crunchbase

SkyGarden, supply-chain enabler Notify Logistics, food-tech startup Kune, Internet supply provider BRCK, and agri-tech start-up WeFarm, which maintained an e-shop carrying agricultural items, were among those wiped out by the tsunami.

Data suggest that all of the organizations studied received significant money before failing, with SkyGarden receiving $6.9 million (Sh1 billion), Notify receiving Sh45 million, Kune receiving $1 million (Sh146.1 million), and BRCK receiving $4.2 million (Sh613.6 million). WeFarm raised the most money, totaling $32 million (Sh4.7 billion).

In a previous interview with the Business Daily, Mr Njonjo sought to dispel suspicions that Twiga Foods was experiencing difficulties, stating that the company expects to be on solid ground within a year of implementing the cost-cutting approach.

source: The star

The Kakamega county government now wants the high court to dismiss a complaint attempting to block the eviction of some tenants on the grounds of lack of jurisdiction.

The county administration requested dismissal of the claim in a notice of preliminary objection filed on Wednesday, arguing that the court lacked jurisdiction to hear the case.

The tenants of Otiende and Amalemba estates initially filed the suit, requesting that the court stop their eviction from the county government dwellings.

According to Article 162(2)(b) of the Kenyan Constitution and Section 13 of the Environment and Land Court Act of 2011, the high court lacks jurisdiction to hear and decide the notice of motion and petition dated August 24, 2023.

“Take notice that the respondent will at the hearing hereof raise a preliminary objection for determination in limine and seek to have the petitioner’s entire notice of motion and petition be struck out or dismissed,” the notice of objection filed on Tuesday reads.

“The entire notice of motion application and petition herewith dated August 24, 2023 is fatally defective, incompetent, misconceived, misplaced, and an abuse of this honorable court’s process and ought to be dismissed with costs,” the notice continues.

The county wishes to have the temporary injunction orders issued by Justice P.J. Otieno on August 24, preventing it from evicting tenants from the two estates pending the hearing and determination of a petition filed by tenants set aside or vacated, and costs awarded. Justice D.K. Kemei, sitting in Bungoma High Court on Wednesday, directed the county to file and serve the petitioner with the preliminary objection by September 15.

He directed parties to present their separate submissions orally on September 20, after which the ruling date on the court’s jurisdiction to hear the case will be announced.

Judge Kemei also extended interim orders issued to Onono on August 24 by P.J. Otieno, preventing the county from evicting the renters until the preliminary objection is heard and adjudicated.

After a failed attempt by county enforcement authorities to evict tenants from the Otiende housing scheme on August 22, Onono went to court through M/S Amasakha & Company Advocates and secured conservatory orders.

He sued the county as an individual renter and on behalf of the occupants of the Otiende and Amalemba housing developments.

According to Onono, the county’s vacation notices given to renters on May 2, 2023, demanding them to hand over the residences by July 31 or face being evicted are illegal and violate their fundamental rights and freedoms.

He contends that the decision to require the tenants to vacate the houses by July 31 was unjust because the respondent failed to provide them with alternative housing, despite the fact that they had requested it.

According to the renters, the county government refused to provide them with lease and tenant purchase agreements in accordance with the original housing policy.

“Members of the Otiende Estate Site and Service Scheme and Amalemba Rentals Site and Service Scheme applied for and were allocated these houses from the dwellings constructed by former local authority through financing by the National Housing Corporation (NHC). The allocation was done on the understanding that it was to be followed by a lease agreement with an option to purchase,” said Onono.

Source: Business daily

Principal secretaries (PSs) and other accounting officers in government ministries, departments, and agencies (MDAs) are racing against limited time to meet a deadline set by President William Ruto for them to respond to all questions highlighted by Auditor-General Nancy Gathungu.

According to a circular issued by the President’s Executive Office, accounting officers have until October 2, 2023, to resolve all outstanding audit queries emanating from the Auditor-General’s reports for fiscal years 2021/2022 and 2022/2023.

“All pending audit queries or issues arising from the OAG [Office of the Auditor-General] reports of the financial year 2021/22 and 2022/23 must be closed off by Monday, October 2, 2023, with a notification to this office by Monday, October 9, 2023,” said the memo signed by the Chief of Staff and Head of the Public Service, Felix Koskei.

An audit query suggests that an auditor has concerns or questions about the genuineness, validity, or accuracy of transactions performed by an audited entity.

“Where an audit query is not capable of being closed off for any reason, the same must be fully explained in writing by Monday, October 9, 2023.No MDA shall attract a new audit query in the entire financial year 2023/24,” the Executive Office of the President said.

The President’s instruction comes after his office conducted a survey of MDA transaction books, which found that less than 30% of audit queries for fiscal years 2021/2022 and 2022/2023 had been adequately handled.

“Audit queries and issues from the basis, or lay the foundation, for vices that undermine government objectives to be a responsive, responsible, efficient, and effective custodian and manager of public resources,” the circular stated.

The President’s directive is a significant boost for the Auditor-General, who has repeatedly protested MDA inaction on queries on unexplained expenditures or transactions totaling billions of shillings every year. For example, in the fiscal year 2021/2022, the Auditor-General’s office flagged transactions in various State agencies, including Sh8.6 billion in unremitted contributions to the National Social Security Fund (NSSF).