Dash, the Ghanaian fintech that aimed to revolutionize cross-border payments for Africans by linking mobile money wallets, has closed its doors after facing a challenging journey. The initial report of the startup’s closure was disclosed by WeeTracker on Friday 6th October.
According to WeeTracker, a pivotal board meeting, which occurred on Friday, January 20, initiated the sequence of events that would ultimately lead to the downfall of Dash, the startup that insiders assert has faced a sharp decline despite securing over $80 million in venture capital (VC) to reshape Africa’s digital wallet landscape. This unexpected turn of events has left both stakeholders and observers in a state of bewilderment.
In 2019, Prince Boakye Boampong founded Dash, generating significant enthusiasm among investors due to the problem the startup aimed to address. Dash’s mission was to establish seamless compatibility between mobile money wallets and bank accounts throughout Africa, promising to simplify and streamline the process of sending money across the continent.
Over the course of five years, the company successfully secured a total of $86.1 million in funding, drawing in prominent investors. In a noteworthy achievement, Dash secured $32.8 million in a seed round in 2021, marking it as the second-largest seed round ever raised by an African startup. The startup continued to raise additional funds through convertible notes and debt financing between October 2021 and 2022.
In 2021, Dash started unveiling remarkable growth figures. According to a publication, Dash asserted that it had facilitated transactions totaling $1 billion and had garnered one million users across Ghana, Nigeria, and Kenya. These figures marked a fivefold surge in its user base in just five months. However, by February, at least two publications raised doubts regarding Dash’s user statistics and performance metrics. Later in the same month, Prince Boakye Boampong was suspended from his position as CEO. Subsequent internal audits of Dash’s data revealed that Boampong had misrepresented and exaggerated the user figures. Consequently, he was terminated from his role, and Kenneth Kinshua was appointed as his replacement.
Reports suggest that the challenges Dash faced were already deeply entrenched when Kenneth Kinshua assumed the role of CEO. According to the publication, a subsequent audit of the company’s finances revealed a substantial shortfall of at least $25 million that remained unaccounted for. With a reported monthly expenditure of $500,000 and no incoming revenue, Dash’s primary issue seemed to be its significant overhead costs, exacerbated by its operations spanning five countries.
During its peak hiring period, Dash had a workforce comprising of over 100 full-time employees and engaged the services of over a dozen consultants in five different countries. Ex-employees strongly believe that the organization’s structure became excessively top-heavy at an early stage. The seemingly oversized organizational setup and lavish spending habits resulted in excessive expenditures on salaries and office expenses, which insiders found particularly perplexing for a startup that had not successfully launched its product into the market.
Previous reports in the media that depicted Dash as undergoing rapid expansion, accompanied by a narrative suggesting unparalleled growth in African tech, were attributed to a misleading image crafted by the former CEO, Boampong, and endorsed by other senior executives who were complicit in misleading practices at Dash, according to WeeTracker.
WeeTracker also reported that Boampong was drawing a monthly salary of $50,000 and was allegedly involved in diverting at least $8 million. There are allegations that these funds were used for purchasing real estate and luxury vehicles. However, Boampong has yet to publicly respond to any of these allegations.
Prior to Dash, Boampong was the co-founder of OMG Digital tagged the BuzzFeed of Africa which also experienced a downfall amid a scandal.