The Internet Was Shocked…

Imprison everyone: 130 employees, $9.1m in salaries, no product???

abraham

Abraham Iyiola

Jul 4, 2024

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Welcome to another edition of Workshift! The exclusive newsletter for Leaders, Founders and Managers.

If you missed last week's issue, catch up here.

In Today's Email:

  1. Did VCs Ignore the Red Flags?
  2. In a surprising interview, billionaire and Bitcoin supporter Peter Thiel questioned Bitcoin's value
  3. AI Tool Of The Week 🤖: Crowdstrike uses threat intelligence to prevent and mitigate security risks
  4. Opportunity Of The Week 💡: Industry Ventures has secured a $900 million fund aimed at investing in small, early-stage venture capital firms

A New York-based startup has raised $50 million, bringing its valuation to $900 million. Their mobile app lets users chat with doctors, seek medical advice, and access prescriptions online.


THE BIG IDEA

Did VCs Ignore the Red Flags?

Image credit: Techcabal

This week, the internet was shocked after reading the news about a crypto startup, Mara.

It's quite a story. Mara was a pan-African crypto exchange founded in 2021 by a team including Chinyere ‘Chi’ Nnadi. They aimed to build Africa's crypto economy and garnered attention. Mara secured $23 million in funding from notable companies.

However, things took a turn for the worse. Mara burned through its cash rapidly. In 2022 alone, it lost nearly $16 million.

They had around 130 employees and were offering high salaries, yet they hadn't launched any product by that time, so there was no revenue coming in to offset these costs.

By 2023, Mara couldn't raise more money, so the company began downsizing. Eventually, Mara ran out of cash and faced huge debts.

In early 2024, Nnadi rebranded Mara as Jara, claiming it was to move past the old issues and start fresh. However, some of the former co-founders believe this was just a way to dodge Mara's liabilities. There were also claims that many of their reported users were fake.

Now, here's where it gets interesting.

Many in the industry believe that the venture capitalists were somewhat reckless for investing in Mara without a viable product in place.

Typically, VCs look for a working prototype or some form of market validation before committing large sums.

But in this instance, the allure of getting in early on what could be the ‘next big thing’ in crypto appeared to cloud their usual judgment.

Given this context, how do you think VCs can better assess the viability of startups in emerging and highly speculative markets like crypto?


Challenge Of The Week 🎯

How about starting a 30-day workout streak? It could even be a short walk, a yoga session, whatever suits you. The consistency will help you build endurance and resilience in your fitness routine.


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Learn From The Best ✍️

Getting fired, not once, not twice…Colonel Sanders’ story is interesting. He was born in 1890 in Indiana and dropped out of school when he was just 13.

Instead of giving up, he started franchising KFC. He sold it for $2 million, which would be about $20 million today.

Don’t forget to save the image so you can always glance through it!

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Meme Of The Week 😂

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Where You Should Be 🌍

Tech Safari Nairobi Mixer

Hosted by Tech Safari, along with AWS Startups, CloudPlexo and Infobip for founders, investors, ecosystem players and tech-curious.

What to expect:

  • ​​Light snacks and drinks
  • ​Guest Speakers (To Be Announced)
  • ​​Name tags, ice-breakers, and connections made
  • ​​A room of tech founders, investors, and operators

Your Target Audience Are Our Friends 🎯

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The Beginning of Infinity explores and establishes deep connections between the laws of nature, the human condition, knowledge, and the possibility of progress.


Roundtable 🔄


  1. Global economic data in June: Eurozone growth slowed, Japan's inflation peaked, UK retail sales rebounded, and US private sector growth accelerated
  1. Bank of England holds interest rate at 5.25%, amid inflation target reaching 2%
  2. A map of where the 500 highest revenue SE Asian Companies are based

Workplace Culture 👥


Investing News & Opportunities 💰

  1. Goldman Sachs added these global stocks to its ‘conviction’ lists
  2. Regxta, a Nigerian fintech startup, won the Pitch2Win competition, securing $10,000 and an all-expenses-paid trip to IVS2024 Kyoto
  3. The founder of Dell is selling $1.3 billion worth of shares. Should investors be getting out, too?
  4. In a surprising interview, billionaire and Bitcoin supporter Peter Thiel questioned Bitcoin's value. He warns of a "volatile, bumpy ride" with no dramatic price increases expected

There’s More To Being A Leader🎖️

  1. Tech leaders are learning from female founders who are disrupting the $750 billion industry
  2. How embedded recruiting is transforming hiring practices
  3. An interview with the founder of Starbucks on how he scaled to nearly 40,000 locations worldwide
  4. AI Tool Of The Week 🤖: Crowdstrike uses threat intelligence to prevent and mitigate security risks
  5. Opportunity Of The Week 💡: Industry Ventures has secured a $900 million fund aimed at investing in small, early-stage venture capital firms
  6. AWIEF has launched nominations for its annual Awards celebrating women founders and entrepreneurs in Africa. Nominations open until August 5th

Pro Tip To Take You Through The Week🌟


What’s Happening? 🤷‍♂️

While you were away at work, these 5 things happened:

  1. Safaricom under pressure for conflicting explanations over two-hour internet outage in Kenya
  2. Is Joe Biden considering stepping back from his re-election bid after last week's rough debate?
  3. After a fourteen-year legal battle, Julian Assange is a free man
  4. MYAirline co-founder is being sued again, by over 200 investors this time
  5. Wise announced Friday that some customer data may have been stolen in the Evolve Bank and Trust breach

Share With Your Friend 📣

If you know this newsletter can help someone in your network, why don't you go ahead and share?🚀


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Written by Onekpe Regina
Edited by Oluwaseye Adesina

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