Africa's Startup Stumbles: Five High-Profile Flops Reveal Hard Lessons for the Ecosystem

Africa’s tech scene has dazzled with blockbuster funding rounds and global buzz, but beneath the hype lies a sobering reality—some of its brightest stars have crashed spectacularly. A new analysis highlights five major startup failures—Dash, Float, Kune, Bento, and 54gene—that collectively raised hundreds of millions before collapsing, exposing deep cracks in governance, strategy, and investor oversight that could guide the continent’s next wave of ventures.

**Dash**, a Nigerian-Ghanaian fintech, raised $86.1 million but folded in 2023 after less than four years. Promising seamless money transfers, it burned through cash with lavish spending and a flawed revenue model, unable to scale against fierce competition in Africa’s crowded payments space.

**Float**, a Nigerian cashflow management platform, secured $17 million but shuttered in 2023. Aiming to digitize invoicing for SMEs, it stumbled on operational missteps and weak market fit, with insiders pointing to founder overreach and poor execution as key culprits.

**Kune**, a Kenyan food delivery startup, raised $3.5 million before closing in 2022, barely a year after launch. High operational costs, cutthroat competition from players like Glovo, and an unsustainable low-price model led to its swift demise, despite early hype.

**Bento**, a Nigerian payroll and HR platform, pulled in $3 million but shut down in 2023. Targeting SMEs with digital payroll tools, it struggled with market adoption and cashflow woes, unable to pivot fast enough in a tough economic climate.

**54gene**, a Nigerian biotech star, raised $45 million to pioneer African genomic research but collapsed in 2023 amid allegations of fraud and investor sabotage. Founder Dr. Abasi Ene-Obong claimed backers undermined the company, spotlighting a murky clash of interests that shook confidence in the sector.

These flameouts, fueled by hubris, shaky governance, and investor FOMO, underscore Africa’s unique hurdles: erratic infrastructure, regulatory tangles, and cutthroat markets. With Nigeria’s startup failure rate at 61%—higher than peers like Kenya (58.73%) and South Africa (54.39%)—the ecosystem demands tighter due diligence and realistic scaling plans. Yet, these lessons could pave the way for more resilient ventures, as founders and investors recalibrate to build sustainable successes in Africa’s high-stakes tech arena.