‘Localizing Costs and Getting Closer to Customers’
The Nigerian fintech startup, Paystack, has announced a scale-down of its operations outside of Africa, leading to the departure of at least 33 employees based in Europe and the United Arab Emirates. This move is part of the company’s effort to focus more on Nigeria, reduce costs, and have a more localized approach to its customers.
Shola Akinlade, co-founder of Paystack, assured the affected employees that the company is taking steps to minimize the impact on their lives. Akinlade stated that the severance package includes 4 months’ salary, accelerated equity vesting, an extension of health insurance coverage by 3 months, and more.
Support for Affected Workers
Akinlade shared this announcement on social media, expressing the difficulty of the decision and emphasizing the company’s commitment to supporting the affected employees during this transition. He also mentioned that his immediate priority is to assist the impacted workers in finding new employment opportunities as quickly as possible.
Today was a difficult day at Paystack.
We’re reducing our operations outside of Africa, and will be parting ways with up to 33 employees in Europe and the UAE.
In the last 3 years, our hiring philosophy was to recruit great talent regardless of location, including opening an…
— shollsman (@shollsman) November 16, 2023
Industry Trends
This decision by Paystack to downsize its workforce outside of Africa reflects a broader trend within the Nigerian fintech sector, where other startups have also reduced their headcounts or ceased operations. Some of these companies have attributed these changes to challenges related to market conditions, including the impact of the crypto winter.
Hot Take
The decision by Paystack to focus more on Nigeria and downsize its operations outside Africa underscores the changing dynamics and challenges within the fintech industry. Despite the difficult decision, the company is prioritizing the well-being of its employees and offering support during this transition.
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