Twiga Foods, a prominent player in Africa's digital food distribution industry, is undergoing significant changes as it faces a challenging 2024. The company, known for revolutionizing food distribution across the continent, is grappling with financial difficulties, legal disputes, and a shift in leadership. These developments highlight the ongoing turbulence within the organization as it seeks to regain stability and chart a path toward profitability.

Financial Struggles and Layoffs

Twiga Foods recently announced a new round of layoffs, with 59 employees set to be affected as part of a broader restructuring effort. This follows a previous reduction in workforce in August 2023, when 283 staff members were let go. The layoffs are indicative of the company’s struggles to manage cash flow issues that have plagued its operations throughout the year. Despite raising over KES 25 billion in funding over the past decade, Twiga has faced delays in paying salaries and suppliers, leading to strained vendor relationships and operational challenges.

Unpaid Debts and Vendor Disputes

The financial challenges at Twiga Foods came to a head earlier in 2024 when the company became embroiled in a legal dispute with Incentro, a Google cloud services reseller, over an unpaid bill of $261,000. The lawsuit not only brought Twiga’s financial woes to public attention but also raised concerns about its ability to manage vendor relationships effectively. This legal battle has further complicated Twiga’s efforts to stabilize its operations and maintain its workforce.

Leadership Transition

Amidst these difficulties, Twiga's founder and CEO, Peter Njonjo, stepped down from his position in March 2024, shortly after successfully raising $35 million through convertible bonds. His departure sparked rumors and speculation, with some insiders suggesting that the company’s ongoing struggles may have influenced the decision. Njonjo’s exit marked a pivotal moment for Twiga, as he had been instrumental in the company’s rise as a leader in Africa's tech and agribusiness sectors.

Following Njonjo’s departure, Charles Ballard, a former executive at Jumia, was appointed as the new CEO in May 2024. Ballard's arrival signaled the beginning of a new phase for Twiga, one focused on strategic realignment and long-term sustainability. Under his leadership, the company has embarked on a series of restructuring initiatives aimed at streamlining operations and reinforcing its core business of digital food distribution, particularly in the fresh produce market.

Focusing on Growth and Innovation

Despite the challenges, Twiga Foods is also looking towards the future by creating 25 new positions within its growth and innovation departments. This move suggests a strategic shift towards areas that the company believes will drive future growth, including stronger partnerships with fast-moving consumer goods (FMCG) manufacturers, logistic efficiencies, and the development of enhanced tech solutions.

In a notice confirming the layoffs, Twiga stated, “The delivery of these efficiency enhancements to the organization will regrettably impact 59 positions. These changes are crucial as Twiga accelerates towards profitability and continues its mission of revolutionizing food distribution in Africa through innovative digital solutions.”