On-demand moto taxi app CanGo Africa, formerly known as SafeMotos and operating in Rwanda and the Democratic Republic of Congo (DRC), has closed after failing to raise sufficient funding to give it enough runway.
Founded in Kigali in 2014, SafeMotos used on-demand and vehicle telematics technology to connect users with vetted motorcycle taxi drivers through its mobile app.
After more than 500,000 trips completed in Kigali, SafeMotos has expanded to Kinshasa, the capital of the DRC, and rebranded as CanGo Africa last year after it secured US$1.1 million in funding.
At the time it said more funding was on the horizon, with the goal being to close a US$1 million SAFE round by the end of 2019 to give it runway for a larger Series A round in 2020. This has failed to materialise, however, and CanGo Africa has decided to close its doors as a result.
While investor enthusiasm and interest has been high, it has not translated to checks being written,” co-founders Barrett Nash and Peter Kariuki said in an email to investors seen by Disrupt Africa.
The co-founders decided that the funds it has committed to the SAFE as of now, US$180,000, are not sufficient to bring us to a healthy Series A without an “irresponsible risk the investors willing to put that money in”.
“We have a choice to change strategy: fire everyone and bootstrap with a brand new pivot, or close. We tried the bootstrap strategy in Rwanda: while we achieved positive unit economics, we weren’t able to tell a story of traction to leverage more funds,” the email said.
“Kinshasa is among the most hostile environments on earth, it needs proper capital to make a company successful here. This is not a shoestring environment. We’ve decided to make the challenging decision to stop while there is still enough money in the bank to pay our employees what we owe them.”
