Dash—the embattled Ghanaian fintech owned by Spektra Technologies has reportedly announced to its staff that the company will be reducing the size of their workforce by about 50%.
This is we after a company-wide town hall meeting held on the afternoon of Tuesday 2nd October 2023.
Two months ago, it was widely reported that that investors were actively seeking to dump Dash. over alleged misappropriation of funds and misreporting of performance.
Prior to that, the company had suffered a setback in Ghana when the industry regulator, Bank of Ghana asked all payment service providers (PSPs) to unplug Dash App because they did not have a license to operate in Ghana.
Some conversations are said to have taken place with some potential investors a but a deal failed to emerge, and that has necessitated the need for Dash to cut back its staff strength to preserve what’s left of it.
On March 7, 2022, Dash announced itself with a $32.8 million seed round to fix the fragmentation between mobile money and banking networks, per TechCrunch’s report. The pedigree of the founder and former CEO, Prince Boakye Boampong as a repeat African founder who had made YC contributed to the startup’s ability to raise the “oversubscribed” seed round at a valuation of $200 million.
The notable investors at the time were Insight Partner, Global Founders Capital, 4DX Ventures, and ASK Capital.
It was just after that landmark seed round that the Bank of Ghana ordered the PSPs to unplug Dash for operating without a license in Ghana. On March 15, 2022, Techfocus24 reported that BoG had ordered Spektra Technologies to halt its wallet creation, cross-border payment, and utility payment services in Ghana without regulatory approval.
While the startup stopped offering its services in Ghana, it operated in other African markets like Nigeria and Kenya.
In July 2022, it was also a victim of the Union54 debacle that beleaguered the ecosystem. There were cases of fintech customers trying to pay with underfunded virtual USD cards or glitches that overfunded customers’ wallets. Union54 claims to have stopped $1.2 billion in chargeback fraud.
However, when a customer is over-credited from a card funding transaction, the fintech company has to recoup the money or pay for it in some way. Sources say Dash claimed to have “lost over $1.8 million” in this time. It’s hard to ascertain the exact amount attributable to the Union54 debacle, as the company has a record of concealing “financials within the firm”.
Dash was accused of three major things. One is an unfavourable work environment “where employees resigned and were laid off at will”. Two is the founder selling “millions of dollars’ worth of his shares in a secondary sale”. The third is that of overall financial impropriety which could indicate a misappropriation of assets and misrepresentation of facts. As a result, Prince Boampong was placed on an “indefinite administrative leave” to make way for a comprehensive financial audit.
While the findings of this audit were not officially disclosed to the public, there were reports that investigations revealed the numbers and transaction volumes were fabricated to mislead investors. Boampong had reportedly told investors that Dash’s total users had grown to around 4.5 million in Q4 2022, with total payment value (TPV) hitting US$560 million and revenue of US$13.7 million in the same quarter.” This “meant Dash had quadrupled its transaction volume and quintupled its user count within five months.”
Following the suspension of Boampong, Dash’s board named Kenneth Kinyua, who was previously the Head of Business Development, East Africa as interim CEO. Kinyua was formerly the CEO of Kopo Kopo, a Kenyan financial services company, before joining Dash.