Bid of $24.5 Million by Engage Capital Intended to Resuscitate Lipa Later from Administrative Control
In a significant development for the Kenyan fintech industry, troubled buy-now-pay-later (BNPL) startup Lipa Later is on the brink of a potential acquisition. The leading bid comes from Engage Capital, a Kenyan venture capital firm, who has offered $24.5 million to acquire Lipa Later's technology infrastructure, customer network, intellectual property, and regulatory licenses, while assuming some liabilities excluding non-performing loans.
Lipa Later, launched in 2018 by Eric Muli and Michael Maina, had previously secured substantial investor support, raising $16.6 million over 10 funding rounds. Notable investors included Cauris, Lateral Frontiers, Orbit Startups, Founders Factory Africa, and others.
The acquisition proposal from Engage Capital includes the purchase of Lipa Later’s fintech infrastructure, operational licenses, and partial assumption of company debts, signifying a revival effort for the startup after failed attempts to secure new funding. The bid was put forward via a letter of intent (LOI) in mid-May 2025 and is subject to due diligence.
Other bidders include a Nairobi-based financial consultancy firm, offering approximately KES 2.5 billion (~$19 million), and Advance Global Capital (AGC), a London-based financial institution offering a KES 646 million loan (~$5 million) structured to support Lipa Later’s operational needs and regional expansion into Uganda and Rwanda.
If the deal with Engage Capital goes through, it could rescue Lipa Later's previously celebrated model, enabling customers to purchase items in instalments while the startup pays vendors in advance. This development could set a precedent for reviving fintech startups facing administration in Kenya and foster a more resilient fintech ecosystem in the region.
However, the road to recovery will not be easy. Lipa Later's business model ultimately struggled, leading to missed payroll obligations and growing unpaid debts to suppliers in 2024. The startup entered administration in March 2025, and restructuring its business model, managing liabilities, and regaining customer trust post-acquisition will be crucial challenges.
Despite these challenges, the potential acquisition could restore confidence in the BNPL model locally, signal continued investor interest and belief in fintech innovation, and help rebuild consumer trust in credit services. If successful, the deal could encourage more structured rescue efforts for struggling startups, fostering a more resilient fintech ecosystem in Kenya and the broader East African region.
[1] TechCrunch. (2025). Lipa Later in Talks for Potential Acquisition Amid Financial Struggles. Retrieved from https://techcrunch.com/2025/05/20/lipa-later-in-talks-for-potential-acquisition-amid-financial-struggles/
[2] Business Daily Africa. (2025). Engage Capital Submits $24.5 Million Bid for Troubled Fintech Startup Lipa Later. Retrieved from https://www.businessdailyafrica.com/news/companies/Engage-Capital-submits-24-5-million-bid-for-troubled-fintech-startup-Lipa-Later/4620348-5253868
[3] The Standard. (2025). Multiple Bidders Eye Troubled Kenyan Fintech Startup Lipa Later. Retrieved from https://www.standardmedia.co.ke/business/article/2001374246/multiple-bidders-eye-troubled-kenyan-fintech-startup-lipa-later
[4] Nairobi Business Monthly. (2025). Undisclosed Bidder Offers KES 2.5 Billion for Lipa Later. Retrieved from https://nairobibusinessmonthly.com/undisclosed-bidder-offers-kes-2-5-billion-for-lipa-later/
- The potential acquisition of Lipa Later by Engage Capital, a venture capital firm, could mark a significant shift in the Kenyan fintech industry, signifying a revival effort for the struggling startup and potentially fostering a more resilient fintech ecosystem.
- The rescue of Lipa Later, a business that previously secured substantial venture capital finance, could restore confidence in technology-driven business models, signal continued investor interest in the African fintech sector, and encourage more structured rescue efforts for struggling startups in the region.
