Following its shutdown in April 2024, Thepeer, a fintech startup founded in 2021, has returned $357,960 to its investors in June, marking the completion of its closure. This refund means that an angel investor who initially invested $10,000 would have received a refund of $2,280.
The decision to refund investors was made by the founders, Michael Okoh and Chike Ononye, who concluded that there was no viable path for scaling up the product.
After the shutdown announcement, some angel investors sought clarification on the company’s financial status. Thepeer had raised $2.1 million in a seed round in June 2022, valuing the company at $5 million, but reports indicated it only had $450,000 in its accounts at the time of closure.
Despite a funding announcement in July 2022, the company claimed to have only received $1.35 million in that round. There were discussions about auditing the company’s finances before finalizing the shutdown, but it seems no audit took place.
While some investors wanted more transparency, others preferred to move on and treat any discrepancies as minor issues. The startup’s closure came after exploring various options, including potential buyouts and pivoting to different sectors like fraud detection and the creator economy.
The challenges faced by Thepeer included low market adoption, regulatory compliance issues, and the need for significant capital to change customer behavior. Despite efforts to innovate and pivot, the startup struggled to generate substantial revenue and failed to achieve the transaction volume required for profitability.
Thepeer’s unique payment method faced stiff competition from conventional payment options in Nigeria, making it difficult to gain traction in the market. The startup’s closure highlights the challenges that fintech ventures face in a competitive and rapidly evolving industry.
Ononye acknowledged the uphill battle Thepeer faced, emphasizing the need for more time and resources to establish a foothold in the market. The startup’s closure underscores the importance of market fit, scalability, and strategic decision-making in the fintech sector.