Kenyan B2B e-commerce food delivery platform Twiga has laid off 211 full-time employees following a restructuring that eliminated the company’s in-house sales team.
Out of more than 1,000 employees, about 21% of the workforce has been cut, mainly in Kenya linking farmers or agricultural producers and fast-moving consumer goods to retailers.
Agritech CEO and co-founder Peter Nyonjo told TechCrunch that the laid-off business development representatives were given the option to work as independent agents for the company based on the number of clients and sales they received.
The agents signed up salespeople and were involved in customer relations, gathering market information and promoting products to customers. In the present proposal, the agents perform the same functions.
Reports also state that Twiga has cut travel allowances for employees as part of cost-cutting measures.
“Twiga has recently launched a new Facilitated Sales Agents program… where existing Business Development Representatives (TDRs) will be transitioned from permanent employees to independent agents at 100% commission,” Twiga said in response to a TechCrush inquiry. The new model was given the first right of transition.
The company said it plans to create 1,000 opportunities through the agent model by the end of the first quarter of next year.
“This transition creates an entrepreneurial opportunity for ex-sales agents and the public. The benefit of this transition is that it allows for higher income based on the agent’s effort and enterprise. This model has worked in Kenya with other businesses such as insurance and banking that have transitioned completely to independent agents.”
In the year Co-founded by Njonjo and Grant Brooke in 2014, Twiga joins a dwindling list of startups in Africa and around the world amid a slowdown in VC funding, which has made it difficult to capitalize on operations and grow.
The changes come a year after Twiga raised $50 million in a Series C round in Kenya to expand into neighboring countries. The round was led by Paris- and Nairobi-based family office and private equity firm Credev, with TLcom Capital, IFC Ventures, DOB Equity and Goldman Sachs spinoff Juven Series investing.
It also manufactures its own private label, Twiga Fresh, and distributes its own agricultural produce to traders, and to deal with traceability challenges, commodity sales and inflation – making it difficult for the company to supply. The promise of reasonable prices and food security.