Lipa Later
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Lipa Later Sought $5 million Lifeline After Entering Administration

Founder Eric Muli pursued funding despite ceding control to court-appointed administrator

7/31/2025
•Anass Baddou
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Kenyan buy-now-pay-later (BNPL) startup Lipa Later attempted to raise $5 million just two weeks after entering administration in March, sparking questions about governance and oversight during the rescue effort. Co-founder Eric Muli spearheaded the attempt in April, seeking a loan from UK-based Advanced Global Capital (AGC) to support the company’s invoice factoring operations. However, by that time, control of Lipa Later had already shifted to a court-appointed administrator, complicating the legitimacy and authority behind the fundraising effort.


Administrator in Control as Financial Troubles Deepen

Following months of financial strain marked by unpaid salaries, missed supplier payments, and failed capital raises, the Nairobi-based startup was placed under administration on March 24. The court appointed Joy Vipinchandra Bhatt of Moore JVB Consulting LLP as administrator, officially relieving the board of all operational control following Kenyan insolvency law. It remains unclear whether Bhatt authorized or was even aware of Muli’s efforts to secure the AGC loan.

Founder Confirms Fundraising Attempt but Cites Legal Process

While Muli confirmed the outreach to AGC, he declined to share further details, citing ongoing legal proceedings surrounding the administration. The term sheet seen by TechCabal revealed that the proposed loan would be a 36-month facility, with an annual interest rate of 14% on drawn funds. For the first 24 months, only interest payments would be required, with principal repayments scheduled quarterly from month 27 onward.

Invoice Factoring as a Last Bet

Unlike traditional consumer credit, invoice factoring involves advancing funds based on receivables, typically viewed as a lower-risk and quicker-turnaround financial product. Lipa Later pitched this new direction as a more viable model compared to its original BNPL framework, which had become increasingly unsustainable under economic pressure. AGC appeared open to the proposal but imposed strict requirements around security, cash flow management, and oversight.

Strict Loan Conditions and Oversight Built In

The facility’s structure called for rigorous financial governance, including dedicated, AGC-approved collection accounts for disbursement and repayment. These accounts would be internet-enabled, with AGC serving as a co-signatory holding full authority to issue instructions to the bank. The agreement also stipulated that Lipa Later could not incur any additional debt without AGC’s prior approval, signaling the lender’s desire for tight operational control.

Past Success and Sudden Decline

Founded in 2018 by Eric Muli and Michael Maina, Lipa Later was once a rising star in Africa’s fintech space. The company had raised $16.6 million over ten funding rounds, including a notable $12 million seed round in January 2022 backed by Cauris and Lateral Frontiers. It also secured early investments from Orbit Startups and Founders Factory Africa, boosting its reputation as a promising player in the region’s digital finance ecosystem.

Questionable Acquisition Amid Crisis

Despite mounting financial stress, Lipa Later surprised many in December 2023 by announcing the acquisition of Sky.Garden, a distressed e-commerce platform, for KES 250 million ($1.9 million). The move drew criticism as the company was already defaulting on obligations and delaying staff payments. Investors and stakeholders were left puzzled by the timing and rationale behind the acquisition, especially as the company’s liquidity crisis became increasingly apparent.

Collapse and Court Intervention

By March 2024, the situation had worsened. Employees had gone unpaid, suppliers were demanding settlements, and attempts to secure additional funding had faltered. The court’s decision to place the company under administration signaled the official acknowledgment that Lipa Later could no longer manage its financial obligations independently.


Lipa Later’s attempt to secure a $5 million loan while under administration has raised serious governance concerns, particularly around the founder’s authority during the court-supervised process. The move, while possibly intended to salvage parts of the business, underscores the complexities that arise when startups collapse under debt and continue operations in legal limbo. As the court process unfolds, the future of Lipa Later remains uncertain—its fate now resting with the administrator and the outcome of Kenya’s corporate insolvency mechanisms.