Nairobi — Online retailer Copia Kenya has announced plans to lay off 1,060 employees due to financial constraints.

The decision comes as the company battles ongoing financial challenges, despite efforts to secure additional funding and navigate the obstacles it faces.

"In light of our persistent financial challenges and despite our best efforts to explore avenues for additional funding, we find ourselves compelled to undertake a comprehensive organizational restructuring to ensure the sustainability of our operations, or even consider the possibility of shutting down," it said in a statement.

Copia Kenya has initiated the process by serving affected employees with the requisite one-month notice period, as mandated by labor laws.

It clarified that the layoffs would exclusively affect individuals whose roles are directly impacted by the restructuring.

However, the company cautioned that should operations be entirely halted, all staff members would be at risk of termination.

The announcement sheds light on the hurdles confronting startups in Kenya as they endeavor to address financial woes and secure the longevity of their operations.

The startup ecosystem in the country has witnessed closures attributed to amplified taxation and operational expenses.

In 2022, Kune, a Kenyan-based food tech startup, exited the market, citing economic strain.

Similarly, Twiga Foods, specializing in farm produce, has undergone downsizing due to harsh economic conditions and diminished profitability.