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Y Combinator - backed Nigerian food procurance startupVendeasehas vary its employee pay bodily structure and is seeking fresh capital , TechCrunch has learned .
This is after lay off44 % of its workforce — around 120 employees — last month , stigmatise itssecond beat of job cuts in five month . In the late growing , the startup has now replaced employee ’ traditional salaries with a performance - ground wage organisation , supplemented by an Equity Share Option Plan ( ESOP ) , according to internal documents seen by TechCrunch .
The 5 - year - old startup , which raised$30 million in its Series A roundled by Partech Africa and TLcom Capital , said the restructuring was necessary to sail to lucrativeness .
Vendease ’s new recompense model includes a five - phase angle salary - recovery architectural plan , the documents say .
In February , all employees receive a ₦ 140,000 ( ~$90 ) earnings , regardless of late pay . From March to May , the company will raise employees ’ reward to 30 % of former tier if they meet performance targets , though it has n’t specified these targets , the documents say .
Compensation will increase to 60 % of former pay from June to August and 90 % from September to November , with full salary restoration expected by December , again dependant upon on company and employee carrying into action goal .
The amateur portions of the salaries will commute into percentage option under the ESOP , with 50 % vesting over 10 months and the residue over three year . But employees can only exercise these options at a board - approve comely market note value , according to the employee agreement .
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The company confirmed the changes to employee pay , insist that it is now at a break - even head , even close to profitability .
“ Vendease has restructured both its job and operations . We ’re a package troupe , and we want to focus on facilitating OPEX - hard surgery with technology rather than treat them ourselves , ” a society spokesperson told TechCrunch .
It says the changes are intended to advance employee productiveness while the company grows more financially sustainable . “ We only pass what we earn , which preserve us systematically at break - even and focused on profitability , ” the representative add together .
With slightly over 150 employees left , Vendease is depend on home restructuring , fresh capital , and AI - driven efficiency to foreshorten costs and maintain operations . As the ship’s company luff out , this also mean focusing more on package - push growth and doubling down on its gross revenue and defrayal solutions and credit market while bit by bit phasing out warehousing and logistics operations .
Betting on BNPL to stay afloat
Founded in 2019 by Tunde Kara , Olumide Fayankin , Gatumi Aliyu , and Wale Oyepeju , Vendease set out to streamline food procurement for African restaurants and food businesses .
The startup claimed it could eliminate inefficiencies in the solid food supply chain , which cost businesses billions every year . By 2022 , it hadmoved 400,000 metrical tons of food for over 2,000 customers , it said , saving them $ 2 million in procurement cost and cutting wastage - related losses by nearly $ 500,000 in Nigeria , its main market .
But the last two years have been brutal for Vendease and many Nigerien startups without FX - denominated gross . Since its Series A in September 2022 , its gross in Nigeria ’s naira has triple , but the currency ’s sharp depreciation within the last three years has wipe out those profit in dollar terms . Inflation has further increased operational costs , gouge profitability for the capital- and people - intensive byplay .
One of Vendease ’s main revenue number one wood within the past year has been its buy now , pay by and by ( BNPL ) product . Traditional lender often quash intellectual nourishment businesses due to their volatility and atomisation . But Vendease leverage its provision chain knowledge to insure loans via its marketplace , which connects financial institutions with food commercial enterprise .
The company lay claim a default option rate of under 1 % over the last two class and hasissued over $ 70 million in creditas of September 2024 .
When CFO Mohamed Chaudry joined in January 2024 , he helped identify BNPL as a key path to gainfulness . However , despite some late tweaks , the credit product alone does n’t seem to be enough to get Vendease there .
His date also set off the on-going restructuring to tighten fiscal controls and strain its immediate payment track , which , according to sources , may only last a few more month .
As such , the company is in talks with existing and novel investors to raise a bridge round of drinks , money it will practice to fund technology growth and expansion rather than operational expense .
Meanwhile , sources also say Vendease has explored a potential sale to other players in the HORECA ( hotels , restaurants , and catering ) and FMCG ( fast - moving consumer goods ) sectors .
The company , however , scrap this and insists it ’s the other way around . “ It ’s normal to get approached for M&A , especially when you ’re a fast - grow business operating in a unique outer space like food . Yes , Vendease has been near , but the founders are focused on grading , not sell anytime presently , ” said a spokesperson .
