Mara, the African crypto exchange, has undertaken a substantial downsizing effort, reportedly letting go of 85% of its workforce and implementing salary reductions for the remaining employees. While Mara has framed these layoffs as a means to eliminate redundant positions, former staff members have claimed that the startup’s exorbitant marketing expenses have contributed to the decision to downsize.
Workforce Optimization: Eliminating Redundant Roles
Mara, the pan-African cryptocurrency exchange, recently joined the list of startups downsizing its workforce, with reports indicating that up to 85% of its employees have been laid off. Furthermore, the remaining staff members have experienced salary reductions.
According to Bitcoin.com News, several crypto and blockchain companies based in Africa have followed a similar path, letting go of a significant portion of their workforce. These startups often attribute their downsizing decisions to the crypto winter, a period of market decline.
Despite completing a $23 million seed equity round in May 2022, Mara justified the layoffs as a means to eliminate redundant positions and propel the company towards its next phase. In a statement, a company spokesperson emphasized that these changes do not alter the company’s future plans.
The crypto exchange stated:
“In the previous year, we have successfully secured $23 million in funding to advance our goal of empowering Africans to generate wealth. We introduced MARA Wallet, which has already attracted over four million verified users. Additionally, we established the Mara Foundation, a non-profit organization committed to accelerating blockchain education and skills development in Africa. Our ambitions extend beyond being solely a crypto exchange, and we are excited to unveil our upcoming plans in the near future. Our mission remains unchanged – to ignite a movement that fosters the rise of a 21st-century Africa by providing universal access to blockchain technology.”
While Mara has presented the reduction in staff as a restructuring effort, former employees cited in a Technext report shed light on the startup’s excessive workforce and escalating marketing expenses as contributing factors to Mara’s downsizing. The report highlights that the pan-African crypto exchange embarked on an extensive public relations campaign across Africa, sponsoring cryptocurrency events, a sporting event, and even the Ghanaian football team.
Despite achieving an increase in the number of verified users, Mara’s mounting overhead costs reportedly compelled the company to issue warnings about potential layoffs. Similar to other crypto entities based in Africa, Mara has also been impacted by the collapse of the FTX crypto exchange, as indicated in the report.