Laying-off and or firing about 50 people in a startup like Jumia is worrisome and as a person who sees patterns and the bigger picture, the situation should raise an ‘orange flag’ (red flag is for total danger). I am not interested in the supposed scandal and or #JumiaVsKonga narrative that seems to pervade this thread. I am seeing it from the point of view of a tech investment analyst. This is worth alerting my client who might have Rocket Internet (parent company of Jumia) stocks in their portfolio. Should they sell or hold? Deutsche Bank restructured their team this morning and it made a worldwide business headline, sending the stock market in frenzy. These supposed ‘regular’ events means a lot to the business and investment world.
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This is a Red flag.
Hello House, I just confirmed from a highly reliable source. Jumia was said to have laid-off over 300 people last week. The person that reported 50 people was a modest figure. Jumia might be in a dangerous financial mess that we are yet to hear about. I will update the house.
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I just confirmed this from my contacts there. The story is true! Massive downsizing!
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@davidsmith8900 Hope you are reading this?
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Definitely.
Jack Dorsey made surprise layoffs cool so everyone’s experimenting with it.
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The question we should be asking is: What departments were the affected people?
An e-commerce company like Jumia depends a lot on technology. And as we all know, technological inventions usually make people that were once useful redundant.
Do you guys think if Amazon’s warehouse technology is installed in Jumia’s, more heads would not roll?
This is the more reason why people have to be more concerned with the career path they take.
I think we need to shed more light on the kind of tasks the affected people were doing before they were let go.
There is a bigger narrative to Rocket Internet’s business model and strategies. FT has a long article on them today - they are one massive mess. Very complicated business structure. Having said that, they are making losses but sitting pretty on top of huge pile of cash, about $1 Billion actually and still raising more money from investors.
I wont advise your clients to ditch their RI stocks just yet. They wont run out of cash just yet. That’s it the deciding factor (for now)
I always thought they were overstaffed. Staff turnover was always high
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If you work in an online (full) retail environment, expect the bee to sting your company soon.
I’m sorry, most Nigerians still prefers the offline thing… Companies are looking for means to reduce their team so as to reduce workforce expenses…
Be careful, you could be fooled by ‘ebili’ promises… What is not your company is not your company. Time we learn to stop over relying on our current ‘borrowed’ jobs.
“Rocket Internet shuts down Zambian classifieds property, Kaymu” via @Techzim https://t.co/bPu5nxS4pD
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nobody in his/her right mind would venture into a business to lose…and why will you prefer a company coming from africa than one from outside africa, does it really matter ?, if their product and service are wonderful…and they are of good intentions why not allow them…they will be helping in developing africa…
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Me too…they have more than enough staff, i saw a freelance job recruitment stuff on their website, the rate at which they were hunting for sales rep and investors was damm much…instead of hunting for customers…misplaced priority.
So painful about the Jumia thing o…companies will always downsize.
You cant blame those working with them for signing “callous” clauses if they exist in their contracts.
Jumia is ambitious but everything is still about profit.
Of course nobody in their right mind would want to lose but not every investment makes money. Investors (all around the world) take alot of losses on some investments. and make up for those losses with other investments. As an African descendant (it does matter) to prefer a company coming from Africa to a company coming outside of Africa is like saying will I prefer one of my siblings to become a billionaire or will I prefer one of my friends to become a billionaire? More than likely, I will prefer my siblings to become a billionaire because there will be more access, more love, more care and concern, then if one my friends became a billionaire. More than likely my friend has a family to take care of as well. When you say good intentions, what do you mean? Also, look at all the companies that came from outside of Africa, how far have they developed Africa up till day? What improvements have they made towards Africa till now? Many (not all but many) are just here to make money, enjoy African women and leave.
Fact is everywhere and everyday, businesses will prune and prune.
Letting people go doesn’t mean that they will not recruit, which they are doing in fact (speaking of Jumia)
AN employer has the right to hire and Fire at WILL as long as he respect the terms of the contract. Sadly, some people will suffer the effects of the action but then, the same Employees leave when they get a better offer and they have to follow the contractual termination process.
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Really?
You would advise your client over Jumia Nigeria which makes up less than 2% of Rocket’s valuation?
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If my client is a Nigerian investor who invested in Rocket Internet, I will surely advise s/he to sell. The hiccups at Jumia paints the bigger picture and there are more than meets the eyes. Rocket Internet is a company bedeviled with many complications and uncertainty. Apart from the stigma of ‘copycatting’ other brands, its business model is flawed. Rocket dabbles into tech ventures where it has no superior strategy or clue on how to whether the storm. Its oversimplified approach of copying pasting what works in Brazil to a Tanzania is a recipe for disaster. Rocket has all the similarities of Enron and cautious investors must be careful with the company. I will not advise any client to buy Rocket’s stock for now. The company has an uncertain future. Time will tell.