Paystack, a payments firm that was acquired by Stripe back in 2020 for US$200 million , has revealed that it is scaling back its operations outside Africa. The company had sort to hire talent globally and even set up an engineering hub in Dubai. However, it has been forced to come to this “painful” decision and focus solely on talent located in the countries Paystack is active.
“We’re reducing our operations outside of Africa, and will be parting ways with up to 33 employees in Europe and the UAE.” wrote Mr. Shola Akinlade, the Co-founder/CEO at the Nigerian fintech.
Going forward the company is set to prioritize locating team members within the markets it serves. This change in operational model has been due to the need “ to localize costs”. Additionally, Paystack claims it would like its employees to get closer to clients they serve.
The redundant staff will have a severance package to cushion them during this difficult transition. The package includes 4 months’ salary payoff. Also, Paystack will accelerate equity vesting and extend health insurance for the laid off employee by 3 months.
This year, Paystack received a Payment Service Provider Authorisation from the Central Bank of Kenya (CBK). This permitted the fintech to provide payment services to businesses operating in Kenya. It marked the beginning of the company’s operations in East Africa’s biggest fintech market.
Paystack is just the latest tech company to lay off employees and restructure. Other African start-ups like Cellulant, Chipper Cash, Sendy, Twiga Foods and Copia have done the same. Globally, giants like Google, Microsoft, Twitter, Nokia, Qualcomm and more have been laying off staff. Most have stated that the turbulent global economy as the reason. This has also affected many starts ups who are struggling to raise funds.