Africa’s tech ecosystem has experienced exponential growth in the past decade, driven by a young population, increased internet penetration, and rising investor interest.
From fintechs to healthtechs and agrotechs, startups across the continent have raised millions in venture capital, scaled rapidly, and positioned themselves as disruptors of traditional systems. However, behind the headlines of billion-dollar valuations lies a growing trend of high-profile startup failures.
In recent years, several notable African startups have shut down despite securing significant funding and media acclaim. These closures expose not only operational and market inefficiencies but also highlight systemic cracks in Africa’s venture-backed ecosystem.
What’s emerging is a cautionary tale that growth-at-all-costs strategies, weak unit economics, and premature scaling can undermine even the most promising ventures.
This analysis takes a close look at some of the most high-profile startup shutdowns in Africa, exploring their origins, journeys, collapses, and what they represent for the continent’s innovation economy. While their stories differ, their endings raise critical questions about funding models, regulatory environments, and sustainability in African tech.
Below, we profile four notable startups, Okra (Nigeria), 54gene (Nigeria), Kune Foods (Kenya), and Notify Logistics (Kenya), to unpack the broader implications of their exits.
Okra (Nigeria)
Founded in 2019 by Fara Ashiru Jituboh and David Peterside, Okra positioned itself as a leading open finance infrastructure startup in Nigeria. The duo launched Okra to build a secure API that enabled real-time access to financial data, bridging the gap between banks and digital service providers.
In just under two years, Okra raised over $16 million in funding from high-profile investors including Accenture Ventures and TLcom Capital. It was praised as a transformative force for Nigeria’s fintech sector, powering services like account verification and credit scoring.
However, recently, the startup announced it was shutting down operations. According to Ashiru, the decision was a “calculated move” to return approximately $4 million to investors rather than continue burning through capital without a sustainable model.
Okra’s shutdown sends shockwaves through Africa’s fintech ecosystem, raising concerns about the scalability of API-driven infrastructure in markets with fragmented banking systems and regulatory uncertainty. It also underscores the pressure to scale fast under investor expectations, often at the expense of market fit and long-term sustainability.
Industry analysts suggest Okra’s closure reflects a mismatch between Silicon Valley-style investment models and Africa’s slower-evolving regulatory and financial environments.
There’s a need for patient capital and realistic growth expectations in African markets,” says Nigerian fintech analyst Tosin Adebayo. “Startups like Okra are often pushed to build for scale before building for sustainability.
54gene (Nigeria)
Founded in 2019 by Dr. Abasi Ene-Obong, 54gene emerged as a trailblazer in genomics with a mission to address Africa’s underrepresentation in global genetic data. Based in Lagos and Washington D.C., the biotech startup sought to unlock insights from African DNA for medical research and pharmaceutical development.
54gene raised over $45 million funding from investors such as Y Combinator, Adjuvant Capital, and Cathay AfricInvest Innovation Fund. During the COVID-19 pandemic, it pivoted into testing, gaining significant traction.
However, by late 2022, the company faced mass layoffs, executive resignations, and operational instability. In 2023, it was formally wound down. Challenges included over-expansion, revenue instability post-COVID, and governance issues.
The fall of 54gene highlights the vulnerability of science-led startups in Africa where biotech infrastructure is still developing and dependent on external grants or crisis-driven contracts. It also raises alarms about corporate governance standards in high-growth African startups, where founder-centric operations often lack institutional checks.
54gene’s collapse is not just a business failure—it’s a warning that deeptech startups need more than hype and headlines,” notes healthtech investor Dr. Sheila Ndlovu. “They need robust business models, diversified revenue streams, and clarity on regulatory alignment. We also need African VC firms that understand how to support long-cycle, research-heavy startups.
Kune Foods (Kenya)
Kune Foods was launched in 2020 by French entrepreneur Robin Reecht, with the goal of providing affordable, ready-to-eat meals for Kenya’s urban middle class. The Nairobi-based cloud kitchen startup set out to vertically integrate food production, packaging, and delivery under one roof.
Kune raised $1 million in pre-seed funding in 2021 and quickly built a food production facility, promising to deliver over 5,000 meals per day. Despite high ambitions, it struggled with high operational costs, poor market product fit, and limited repeat customers. By June 2022, just 18 months post-launch, Kune shut down, citing rising food prices and unsustainable burn rates.
Market experts view that Kune’s failure illustrates the challenge of transplanting Western startup models into African markets without deep local insights. Food delivery in Africa faces unique logistical, cultural, and economic dynamics. Kune’s assumption of a tech-driven food service revolution overlooked real market behavior and thin profit margins.
Reecht misunderstood both his market and operational realities,” says Nairobi-based startup advisor Wanjiku Gichure. “Kune was trying to do too much, own the kitchen, logistics, branding, without clear differentiation or a scalable model. Startups in Africa must be lean and hyper-local to survive.
Notify Logistics (Kenya)
Notify Logistics was co-founded in 2018 by Josiah Gatundu and Michael Musyoka. It aimed to help small business owners and online sellers access affordable retail space in Kenya by offering shared shelf space in physical stores across major cities.
The startup gained popularity quickly, expanding its outlets in Nairobi and Mombasa. It provided a valuable bridge for online sellers to access offline customers. Despite initial success, Notify abruptly closed its operations in 2022. The founders cited unsustainable rent costs and rapid expansion as the main factors behind the closure.
According to analysts’ conclusion, Notify’s closure reveals the fragile economics of retail-tech models in Africa’s urban centers, where rent costs are high and consumer purchasing power remains low. The startup also struggled to balance digital ambition with physical infrastructure costs, a common trap for asset-heavy African ventures.
Notify’s model had potential but lacked a disciplined approach to capital management,” says retail expert Catherine Mwangi. “They should have piloted longer before scaling. Investors also need to fund operational runway, not just expansion dreams.
Why It Matters
Highlighting African startup shutdowns isn’t pessimism, it’s essential for ecosystem growth, offering lessons, shaping policy, and guiding future founders toward smarter, resilient business building.
Documenting startup failures preserves vital lessons, preventing repeated mistakes. Transparency turns past missteps into guidance, helping future founders build better by learning from others’ decisions and experiences.
Analyzing shutdowns alongside successes balances Africa’s tech narrative, normalizing failure as part of innovation and fostering a more realistic, mature view of progress on the continent.
Startup failure stories guide smarter investments and policies, revealing ecosystem gaps in regulation, infrastructure, or talent, insights that help governments and investors build a stronger, more supportive tech landscape.
Writing about shutdowns challenges stigma, showing failure as part of growth. It empowers founders to learn, adapt, and try again, fostering a culture of resilience in African entrepreneurship.
Talking Point
The shutdowns of Okra, 54gene, Kune Foods, and Notify Logistics are not merely individual startup failures, they reflect the structural growing pains of Africa’s tech ecosystem.
While these cases underscore the importance of sustainable business models, realistic scaling, and strong governance, they also expose the limitations of relying solely on private venture capital in fragile and often under-regulated environments.
African governments have a crucial role to play in this evolution. Beyond providing favorable policies and tax incentives, they must invest in digital infrastructure, streamline regulatory processes, and create innovation-friendly environments through startup legislation, access to grants, and protection of intellectual property.
In many instances, startups operate despite government inefficiencies rather than because of enabling policies. This must change.
Moreover, governments can foster public-private partnerships to support long-term R&D, incubate local talent through education reform, and ensure that the benefits of digital transformation reach all corners of the economy, not just urban elites.
With coordinated efforts between policymakers, investors, founders, and civil society, Africa’s tech industry can mature beyond boom-and-bust cycles into a sustainable engine for economic development and innovation.
The question is no longer whether African startups will fail, it’s whether the ecosystem, including its governments, will learn from those failures and build a stronger foundation for what comes next.
