Mastercard Grants Money to 54 Groups: Insider Report
In the world of African tech, M-KOPA Kenya Limited is currently at the centre of a legal firestorm. A former manager at the company, Elizabeth Njoki, has filed a lawsuit alleging discrimination in the allocation of company equity during a shareholding restructure in 2019. The case, which could set a precedent for equity practices in venture-backed startups in Africa, particularly in Kenya, is ongoing [1][2][3].
According to the lawsuit, M-KOPA is accused of favouring white expatriates and global investors, while discriminating against its African staff. Court documents show that out of 48 early Growth Shareholders, only 7 were African, and none were Kenyan [1]. This allegation, if proven, raises questions about corporate governance and equity distribution within the African tech scene.
Despite these legal challenges, M-KOPA has received a $160 million term sheet, indicating continued business activity [2][4]. However, the lawsuit remains a critical issue, as it highlights the need for fair and transparent equity practices in the industry.
Meanwhile, another controversy has arisen concerning The 54 Collective, a South African organisation that allegedly misused more than $42 million from a Mastercard Foundation grant [5]. The organisation spent nearly $700,000 on a name change without permission and rerouted $4.59 million of the grant to Founders Factory Africa [5]. Mastercard pulled the plug on the grant agreement with The 54 Collective, and the organisation is now facing liquidation [5].
Furthermore, The 54 Collective's books suddenly flooded with 2,000+ "adjusting journal entries", with no audited financial statement, and the organisation attempted to quietly wind itself down under the guise of "business rescue" [5].
On a more positive note, the Monetary Policy Committee (MPC) in the UK is choosing to watch and wait as inflation cools [6]. Meanwhile, ChatGPT, a popular AI model, now handles 2.5 billion prompts from users worldwide each day, according to CEO Sam Altman [7].
References: [1] The Standard, M-KOPA Equity Disparity Lawsuit: A Precedent-Setting Case, www.standardmedia.co.ke [2] TechCrunch, M-KOPA Faces Equity Disparity Lawsuit, techcrunch.com [3] Quartz Africa, M-KOPA Faces Equity Disparity Lawsuit, qz.com [4] Business Daily Africa, M-KOPA Secures $160 Million Term Sheet, www.businessdailyafrica.com [5] The Citizen, The 54 Collective's Misuse of Mastercard Foundation Grant, www.thecitizen.co.tz [6] BBC News, MPC Chooses to Watch and Wait as Inflation Cool, www.bbc.co.uk [7] The Verge, ChatGPT Now Handles 2.5 Billion Prompts Daily, www.theverge.com
The controversy surrounding M-KOPA Kenya Limited's alleged discriminatory equity practices in African-backed startups raises questions about corporate governance and tech business equity distribution. On the other hand, the mismanagement of funds by South African organization The 54 Collective from a Mastercard Foundation grant highlights the need for fair and transparent financial practices in the technology sector, particularly in business organizations that receive grants.
