Is it a slow news week when two founders steal money and disappear?
A slow week lets us argue about the Queen
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Today’s Notadeepdive is 1,155 words.
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You know you’re important when you die on a Thursday and you’re still the biggest piece of news from that week. I was tempted to say the death of Queen Elizabeth II represents the end of an era, but I’ve been on Twitter in the last 48 hours and I gotta tell you, it’s been polarising. People can’t seem to agree on what the Queen’s death means: the end of an era or good riddance to a symbol of colonialism? Whatever side of the fence you are, world events like this suck attention away from everything else.
Yet, there was not much to take attention from this week because, my word, it was a pretty slow week. You know who likes slow weeks? Public Relations people, because the odds that any journalist or publication is publishing your press release about some announcement on a busy week is next to nothing. So this week, PR people earned their keep, pushing out announcements like Kippa’s super-agent banking licence and Google’s Black Founders Fund largesse which 23 Nigerian startups got.
These announcements are a great way to move on from two weeks of extensive reporting on layoffs in Nigeria’s ecosystem. In those two weeks, everyone sat still, much like you do in a class where the lecturer is asking difficult questions and you hope like hell he/she doesn’t call you. But the show must go on, so on Slack and in meeting rooms, business leaders continue to rally the troops and remind them that sometimes, uncertainty is the nature of the beast.
This week, one argument caught my attention, and pointing it out is critical at a time when Nigeria’s best talents continue to answer the Japa call. If you thought it was difficult to find reliable talent last year, this year has proven to be more difficult. I’ve even seen a few jokes aimed at Access Bank after it announced lower entry standards for its new set of management trainees. It’s a reflection of the reality that the talent pipeline is facing challenges from entry to mid-level.
Some of the conversations this week were about what it’s like to work at startups. According to multiple accounts, employees join startups, take on multiple roles and put in a great deal of work and generally are important to moving the company forward. Yet, months down the line when the company grows, senior managers are brought in to do the exact same thing those early employees had been doing, with better pay.
Multiple tweets (I contributed some) suggested that this is a sore point for many employees. Founders and senior-level people were quick to point out that this is the nature of startups. You may be critical to a startup’s growth when it’s trying to move from 0-10, but you may not have the experience to move the company from 10-100. It’s an argument that’s made in an essay called “Hypergrowth and the law of startup physics.” Here’s an excerpt from the essay:
“I worked with a company as the engineering team went from 20 to 60 to 100 to 200 people. In a matter of months, the engineering manager that got them from 15 to 60 people started to flounder,” says Halim. “People talk about learning on the job, but the truth of it is that managing teams growing at that clip is not something that is natural unless you've done it before. So at 60, people started to feel like they weren't being led well. So at that moment in time, you have to do what's called turning the team.”
If you haven’t already gotten the gist of the argument, it’s that you might be good enough to kickstart growth, but you may not be good enough to move to the next level of growth. Interestingly, from this founder-first perspective, only the CEO, thanks to his vision, is immune to this need to be disposed of when the company kicks up the gear to the next level.
Like every Twitter conversation, it quickly devolved into an Us vs Them argument. The founders and operators on the one hand wrote threads about how these are critical decisions to help a company move forward. The employees on the other hand are asking that if CEOs can be coached and allowed to grow into their roles, why can’t they be offered the same grace?
I don’t have any answers, but there’s something I think the founders may be missing in the argument. While the rank-and-file Nigerian workers may not have the luxury of quiet quitting or resigning from jobs to find fulfilment, there’s a rising class of mid-level workers that are disillusioned. If you believe the stories, these people are leaving banks in droves for jobs where they’re more valued. Tech companies have long positioned themselves as that sort of utopia, so it’s strange messaging to tell the same talents that they may only be useful for short stints.,
While this is not ignoring the obvious need for employers to upskill, we should not be too quick to dismiss these concerns from employees. At a time when the talent pipeline is under pressure, why should anyone rush to a startup that takes a short or medium-term view of the value of its employees?
That said, it’s time to admit that I lied and that there’s some big news from this week
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What’s happening at Capiter?
Capiter, the Egyptian B2B e-commerce startup that raised $33 million is in the news today, following reports that the company’s CEO and COO have been removed by the board. A report by Smashi TV claims that Mahmoud Nouh and Ahmed Nouh, the CEO and COO, allegedly embezzled funds from the company.
One press release I saw stated that “[the board] approved a motion to remove Mahmoud and Ahmed Nouh from their positions as CEO and COO, effective immediately. Further, the board has commenced an investigation against Mahmoud Nouh and Ahmed Nouh, alleging that the two have embezzled funds from the company, breached fiduciary duties, and potentially committed fraud. Mahmoud and Ahmed Nouh have left Egypt and their current location is unknown.”
“This action follows a week in which representatives of the Board and shareholders conducting on-site due diligence for a potential merger discovered misappropriated funds while conducting interviews with team members in Cairo. Since then, the rest of the management team—some of whom had recently resigned in protest of what they felt was mismanagement by the Nouhs—has worked diligently to maintain order on the ground and step in as a leadership team. Majid El Ghazouli, Capiter’s CFO, is acting as interim CEO as remaining leadership works to stabilize the situation and continue conversations with potential acquirers, who remain interested in the Capiter asset.”
This has the feel of a developing story to it and I’ll definitely share more on Sunday.\
See you on Sunday!