Investment Firm Engage Capital Makes $24.5M Offer to Resuscitate Lipa Later from Bankruptcy Administration
In a significant development, financial services firm Engage Capital has submitted a bid of approximately Ksh 3.18 billion ($24.5 million) to acquire Lipa Later, a Kenyan buy-now-pay-later (BNPL) startup that entered administration in March 2025.
Founded in 2018 by Eric Muli and Michael Maina, Lipa Later had previously raised $16.6 million over 10 funding rounds. Key investors include Cauris and Lateral Frontiers, who led a $12 million seed round in January 2022, Orbit Startups, and Founders Factory Africa, who invested in pre-seed rounds in 2021 and 2019, respectively.
The proposed deal, if finalized, would involve the acquisition of Lipa Later's technology platform, customer base, intellectual property, operating licenses, and a partial assumption of liabilities, excluding non-performing loans. This acquisition aims to revive Lipa Later and potentially clear the company’s liabilities and loan portfolio, reshaping Kenya’s digital credit market landscape.
The funding shortage that led to Lipa Later's administration in March 2025 resulted in missed payroll obligations and growing unpaid debts to suppliers. However, acquisition discussions for Lipa Later started prior to its entry into administration, with Moore JVB Consulting, the court-appointed administrator, continuing outreach to potential investors since then.
If the deal with Engage Capital goes through, it could rescue the remnants of Lipa Later's previously celebrated BNPL model. At its height, Lipa Later was active in Kenya, Uganda, and Rwanda, with expansion plans targeting Nigeria and Ghana.
This bid, if successful, would represent a rare recovery for a Kenyan startup under administration, as insolvency cases in the region often end in collapse due to legal disputes and debt issues. The deal is still subject to due diligence and court approval.
Eric Muli, co-founder of Lipa Later, acknowledged that acquisition discussions are underway, but withheld additional information due to ongoing court proceedings. Engage Capital, a Canadian firm focusing on growth investments and capital markets, is optimistic about the potential to revitalize Lipa Later and contribute positively to Kenya's digital credit market.
The proposed acquisition of Lipa Later by Engage Capital, a Canadian firm focused on growth investments and capital markets, could potentially involve significant investments in technology, aimed at revitalizing the business and clearing its liabilities. This deal, if accepted by the court, could mark a groundbreaking turnaround for entrepreneurs Eric Muli and Michael Maina, founders of the BNPL startup.
