Pivo: A Promising Venture That Met an Untimely End
Pivo, a digital bank for trade based in Nigeria and backed by Y Combinator, has officially shut its doors, marking a significant loss in the African startup ecosystem. Unlike many other startups that faced closure in 2023 due to macroeconomic challenges and funding shortages, Pivo’s demise is attributed to unresolved conflicts between its founders, Nkiru Amadi-Emina (CEO) and Ijeoma Akwiwu (COO). This internal strife has not only tarnished the company’s reputation but also hampered its ability to secure future investments.
The Rise of Pivo
Founded in 2021, Pivo emerged from the entrepreneurial spirit of Amadi-Emina and Akwiwu, who were friends before becoming business partners. Their journey began in 2015 when they met at a birthday party and later co-founded SourcePro, a logistics company in Abuja. The challenges they faced in that venture inspired them to create Pivo, a digital bank designed to facilitate trade in Africa.
In 2022, Pivo made headlines by securing a $2 million seed round, a remarkable feat for a female-led startup in a continent where only a small fraction of venture capital funding goes to women-led businesses. At the time, only 1.2% of global venture funding was allocated to African startups, with a mere 13% of those having a female CEO. Pivo’s success story was not just about numbers; it represented a significant step towards gender equality in the tech industry.
The Conflict Unfolds
Despite its promising start, Pivo’s internal dynamics began to unravel. Sources indicate that the conflict between Amadi-Emina and Akwiwu intensified following the announcement of their seed funding in November 2022. Tensions reportedly arose when Amadi-Emina continued to manage another business while serving as Pivo’s CEO, appointing her brother as the company’s secretary, which did not sit well with Akwiwu. This led to a breakdown in communication and collaboration, ultimately affecting the company’s culture and operations.
In May 2023, Pivo’s investors intervened in an attempt to salvage the situation. A memo from the meeting outlined plans to replace the founders’ employment contracts with new agreements aimed at addressing the issues plaguing the company. The investors proposed the establishment of an operational Board of Directors to guide the leadership and protect their investments.
Attempts at Resolution
The investors’ intervention included a controversial decision for Akwiwu to resign from her role as COO, along with a compensation package. This move was intended to stabilize the company and ensure that both founders would focus solely on Pivo, avoiding any potential conflicts of interest from outside ventures. The memo emphasized the need for mutual respect between the co-founders and a commitment to refrain from public disparagement of each other or the company.
Despite these efforts, the underlying tensions remained unresolved, leading to a town hall meeting where the decision to shut down Pivo was ultimately made. The startup has not yet disclosed how it plans to transition its users during this period of closure.
The Impact of Pivo’s Closure
Pivo’s shutdown is a significant blow not only to its founders but also to the broader African startup landscape, particularly for female entrepreneurs. The company had made strides in providing financial services to small and medium-sized enterprises (SMEs), with Pivo Capital allocating over $3 million in loans and achieving a remarkable 98% repayment rate. Additionally, Pivo Business experienced a staggering 400% growth in transaction volume within just a few months.
The story of Pivo serves as a cautionary tale about the importance of co-founder dynamics in the startup world. As highlighted by legal experts, conflicts between founders can often derail promising ventures, especially when they arise after significant funding rounds.
A Personal Reflection
In a previous interview, Akwiwu acknowledged the challenges of working with a close friend, emphasizing the need for clear communication and established boundaries. "It is not me versus you but us versus the issue," she stated, highlighting the complexities of blending personal relationships with professional ambitions.
As the dust settles on Pivo’s closure, the future of its founders remains uncertain. Both Amadi-Emina and Akwiwu have yet to comment publicly on the situation, leaving many to wonder what their next steps will be in the ever-evolving landscape of African entrepreneurship.
This unfolding narrative serves as a reminder of the delicate balance between ambition, partnership, and the realities of running a startup in a challenging environment.