The shuttering of Kenya’s equity management platform reveals the harsh arithmetic of B2B fintech in emerging markets

The Story

After seven years of attempting to digitise equity management for African startups, Raise officially shuttered operations in September 2024, migrating its user base to Carta, the Silicon Valley-based equity platform. The Nairobi-based fintech, founded in 2018 by Marvin Coleby, Tina Nyamache, and Eugene Mutai, had raised funds from respected early-stage investors including 500 Startups, Microtraction, and Launch Africa.

The company’s trajectory illustrates both the promise and peril of B2B fintech in Africa. Initially conceived in 2019 as a blockchain solution for pre-IPO share trading, Raise pivoted to become what TechCrunch once dubbed “Africa’s Carta”, focusing on cap table management and fundraising infrastructure. By 2021, the platform had onboarded over 200 companies and managed equity worth $150 million, with startup valuations totalling over $90 million.

The irony proved acute: in 2023, Carta itself invested in Raise, viewing the partnership as bridging regional expertise with global infrastructure. Yet this strategic alliance could not solve Raise’s fundamental challenge. As CEO Marvin Coleby explained in his LinkedIn announcement, “Raise never quite found the right business model for venture. Private equity made the most sense, but doing that alone wouldn’t scale”.

The Context

Raise’s demise reflects broader structural challenges facing B2B fintech across sub-Saharan Africa, where venture capital ecosystems remain nascent compared to established markets. The company’s struggle to achieve scalable unit economics mirrors difficulties experienced by other infrastructure-focused startups in the region.

The African venture capital landscape, while growing rapidly, lacks the density necessary to support specialised service providers. Nigeria and Kenya, the continent’s largest startup ecosystems, collectively recorded approximately $400 million in venture funding during 2023—roughly equivalent to a single large Series C round in Silicon Valley. This fundamental mismatch creates insufficient addressable market size for niche B2B services.

Furthermore, African startups typically operate with compressed fundraising cycles and smaller round sizes compared to their Silicon Valley counterparts. Where Carta benefits from managing equity for companies raising $50-100 million rounds regularly, African startups more commonly raise $1-5 million. The revenue potential per client remains constrained by these structural differences.

Regulatory complexity compounds these challenges. Unlike the United States, where Delaware corporate law provides standardisation, African startups navigate diverse legal frameworks across jurisdictions. This fragmentation increases operational complexity while limiting scalability benefits that drive successful B2B platforms.

The Intelligence

For venture capitalists, Raise’s closure illuminates critical considerations when evaluating B2B fintech opportunities in emerging markets. Market density matters more than market size—a lesson Silicon Valley learned during the dot-com era but one that requires fresh application in African contexts.

The timing of Coleby’s transition to Carta as Head of Product for Asia, Middle East, and Africa suggests strategic hiring patterns worth monitoring. Rather than compete with global platforms, founders with regional expertise may increasingly find acquisition or acqui-hire pathways more attractive than standalone scaling. This trend could accelerate as US tech giants seek emerging market penetration.

For founders building B2B infrastructure, Raise’s pivot attempts—from blockchain to equity management to private equity focus—demonstrate the importance of rapid iteration in constrained markets. However, the company’s inability to achieve sustainable unit economics despite multiple pivots suggests that some market segments may simply lack sufficient density for venture-scale returns.

The migration to Carta Launch, a free tier for early-stage startups, reveals how global platforms can leverage superior economies of scale to provide previously premium services at zero marginal cost. African B2B startups must therefore identify defensible moats beyond features that global competitors can commoditise.

Investors should note that Kenya has experienced “a wave of high-profile startup shutdowns” in 2024, suggesting broader ecosystem stress. This pattern may create opportunities for consolidation plays or indicate that certain segments require longer runway periods than traditional venture timelines accommodate.

The Bridge

For VCs Reading This: “If you missed lessons from this shutdown, consider three strategic pivots:

• Focus on B2C fintech with African consumer payment volumes—companies like Flutterwave and Paystack demonstrate scalable unit economics in this segment
• Target B2B solutions serving established corporates rather than startups—mature African banks and telecoms offer larger contract values and predictable revenue
• Seek regional champions with clear acquisition pathways to global platforms—following Coleby’s trajectory to Carta’s AMEA leadership”

US VCs Active in This Space: “- 500 Startups – Among Raise’s early backers, continues African investments but may shift focus toward consumer-facing solutions

• Carta – Now seeking regional talent and local partnerships following Raise acquisition; demonstrates appetite for emerging market expansion through talent acquisition
• Microtraction – Nigeria-focused fund with portfolio companies including Paystack; emphasises market-proven business models over early-stage infrastructure plays”

For Founders Reading This: “Key takeaways for avoiding similar failures:

• Validate market density before market size—ensure sufficient customer concentration to achieve economies of scale within reasonable timeframes
• Design for acquisition from day one—global platforms increasingly prefer talent and market access over direct competition
• Target established enterprises over startups—mature African corporates offer contract values and payment reliability that venture-backed startups cannot match
• Build defensible local advantages—regulatory compliance, government relationships, or local payment integration that global competitors cannot easily replicate
• Consider B2B2C models—serving consumers through business partnerships can provide venture-scale addressable markets while leveraging B2B relationships”

The Raise story serves as a sobering reminder that promising markets and capable teams do not guarantee scalable business models. In Africa’s evolving fintech landscape, success increasingly belongs to companies that solve for local market constraints rather than importing Silicon Valley playbooks wholesale.