Investment firm Engage Capital Proposes $24.5 Million Offer to Resuscitate Lipa Later from Administrative Control
In a potential turnaround for the Kenyan startup scene, Engage Capital has submitted a bid of $24.5 million (Sh3.17 billion) to acquire Lipa Later, a buy-now-pay-later (BNPL) startup that entered administration in March 2025[1][2][4][5]. The offer, submitted in mid-May 2025, includes the acquisition of Lipa Later's technology platform, customer base, intellectual property, regulatory licenses, and performing loan book, while excluding non-performing loans[1][2][4][5].
Lipa Later, founded in 2018 by Eric Muli and Michael Maina, had raised around $16.6 million across 10 funding rounds, including a $12 million seed round led by investors like Cauris and Lateral Frontiers in 2022[1][2]. The BNPL firm expanded regionally into Uganda and Rwanda but faced financial difficulties starting in 2024 due to a tough economic environment in Kenya, including taxation changes and currency weakening[3].
The acquisition by Engage Capital, if successful, could mark a rare recovery and turnaround for a Kenyan startup under administration, contrasting the typical collapse and lengthy insolvency processes seen in the local startup ecosystem[1][2]. It signals potential revitalization for the Kenyan BNPL market by preserving technology infrastructure and customer relationships rather than outright failure.
The bid is one of several proposals aimed at rescuing Lipa Later. Another bid comes from a Nairobi-based consultancy firm offering $19 million, while Advance Global Capital has offered a loan facility of $5 million tied to Lipa Later’s receivables[3][4][5].
If the deal with Engage Capital is finalized, it could rescue Lipa Later's model that enabled customers to purchase items in instalments while the startup paid vendors in advance. This acquisition attempt reflects Engage Capital’s strategic interest in Kenyan fintech and may boost investor confidence in recovering distressed startups within the country’s increasingly competitive digital finance sector[1][3][4].
Key Points
- Offer amount: $24.5 million by Engage Capital.
- Assets targeted: Technology platform, customer base, intellectual property, regulatory licenses, performing loan book.
- Exclusion: Non-performing loans.
- Other bidders: Nairobi consultancy firm ($19m offer), Advance Global Capital (loan facility $5m).
- Background: Lipa Later raised $16.6 million over 10 rounds, faced financial distress starting 2024, placed under administration in March 2025.
- Potential impact: Could set a precedent for successful startup turnarounds in Kenya, save fintech innovation, and strengthen the BNPL market.
[1] Business Daily Africa. (2025, May 20). Engage Capital to acquire Lipa Later in $24.5m deal. Retrieved from https://www.businessdailyafrica.com/news/companies/engage-capital-to-acquire-lipa-later-in-sh3-17-billion-deal/1123392-5202638/
[2] TechCrunch. (2025, May 20). Engage Capital submits $24.5 million bid for troubled Kenyan BNPL startup Lipa Later. Retrieved from https://techcrunch.com/2025/05/20/engage-capital-submits-24-5-million-bid-for-troubled-kenyan-bnpl-startup-lipa-later/
[3] The Standard. (2025, May 21). Three firms vie for Lipa Later acquisition. Retrieved from https://www.standardmedia.co.ke/business/article/2001373754/three-firms-vie-for-lipa-later-acquisition
[4] TechMoran. (2025, May 20). Engage Capital submits $24.5 million bid for Lipa Later. Retrieved from https://www.techmoran.com/2025/05/20/engage-capital-submits-24-5-million-bid-for-lipa-later/
[5] The East African. (2025, May 20). Engage Capital submits $24.5 million bid for Lipa Later. Retrieved from https://www.theeastafrican.co.ke/business/engage-capital-submits-24-5-million-bid-for-lipa-later/
[6] TechCrunch. (2022, January 13). Lipa Later raises $12 million seed round led by Cauris and Lateral Frontiers. Retrieved from https://techcrunch.com/2022/01/13/lipa-later-raises-12-million-seed-round-led-by-cauris-and-lateral-frontiers/
[7] TechMoran. (2021, August 17). Lipa Later secures $1.5 million pre-seed funding from Orbit Startups. Retrieved from https://www.techmoran.com/2021/08/17/lipa-later-secures-1-5-million-pre-seed-funding-from-orbit-startups/
[8] TechMoran. (2019, August 28). Founders Factory Africa invests $1 million in Lipa Later. Retrieved from https://www.techmoran.com/2019/08/28/founders-factory-africa-invests-1-million-in-lipa-later/
[9] The Star. (2025, March 1). Lipa Later placed under administration. Retrieved from https://www.the-star.co.ke/news/2025/03/01/lipa-later-placed-under-administration-nmbk-appoints-moore-jvb-consulting-as-administrator_c16418785
[10] Business Daily Africa. (2024, February 10). Lipa Later misses payroll obligations, suppliers demand payment. Retrieved from https://www.businessdailyafrica.com/news/companies/lipa-later-misses-payroll-obligations-suppliers-demand-payment/1123392-5180860/
- The strategic interest shown by Engage Capital in acquiring Lipa Later, a Kenyan fintech startup, indicates their commitment to venture capital financing in the technology sector.
- The possible revitalization of the Kenyan buy-now-pay-later (BNPL) market could attract more business investors, given the potential for growth in regional finance.
