A New Beginning for Nnadi
Chinyere ‘Chi’ Nnadi, Co-founder and CEO of Mara, has launched a new crypto company, Jara, to replace the troubled Mara Wallet. This move comes after Mara faced significant financial challenges, prompting a shift in strategy and branding.
The Rise and Fall of Mara
Mara made headlines in May 2022 when it announced raising $23 million in funding from high-profile investors, including Coinbase Ventures, Alameda Research (FTX), DAO Jones, and nearly 100 other investors and angels. The startup launched with a pre-money valuation of $70 million, quickly becoming an attractive proposition for investors.
Financial Woes and High Expenses
Despite the initial excitement, Mara's financial health quickly deteriorated. According to an audited financial statement sent to investors in 2022, the startup lost $15.9 million. The company did not record any revenue in 2022, as it had no product to offer. However, expenses were substantial, with $9.1 million spent on salaries, bonuses, and allowances for 130 staff members.
In a report to investors, Nnadi acknowledged that Mara paid high salaries to attract top talent from companies like Apple and Yellow Card, who did not always meet expectations.
Development and Launch of Mara Wallet
Mara’s leadership pushed forward with developing a crypto wallet and a layer-1 blockchain backed by Mara tokens. When the Mara Wallet launched in February 2023, the company claimed to have 4 million verified users and stated that users were earning Mara tokens for educating others about crypto.
However, internal documents revealed that Mara burned through cash rapidly. By the end of 2022, only $5 million remained in cash reserves, prompting the company to consider further fundraising in 2023, which ultimately did not materialize.
Emergence of Jara
As Mara ran out of funds, Nnadi registered a new crypto company named Jara in the first quarter of 2024. The transition was announced to Mara's user base through a Telegram message from an anonymous community manager, urging nearly 10,000 users to download the new Jara app—a non-custodial crypto wallet. The message assured users that the company’s investors approved the new direction.
Leadership and Internal Struggles
Former Mara executives attributed some of the financial issues to Nnadi's spending habits, which they claimed lacked oversight. In response to these challenges, Mara had to cut its staff size by June 2023 to save costs and reportedly owed vendors more than $3 million, putting the company at risk of shutting down.
In a note to investors, the co-founders expressed disappointment, stating, "Mara could have been something extraordinary, but its CEO took it down a dark and rotten path." Nnadi did not respond to multiple requests for comments.
