The global tech boom, which crescendoed when the pandemic forced people indoors and online, has ended. As consumers dialed down their app-based consum

Beyond the Valley: Nine companies hit hard by the global tech crash

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2023-03-16 13:00:03

The global tech boom, which crescendoed when the pandemic forced people indoors and online, has ended. As consumers dialed down their app-based consumption and interest rates went up to fight inflation, investors tightened their belts. Around the world, startups and major tech companies alike are scrambling to adjust — if not folding entirely. E-commerce giants like Alibaba and Jumia slashed their workforces in 2022. Salvadorean delivery company Hugo closed in its home market, while Pakistan’s Airlift shut its doors completely. Here are some of the companies outside of North America and Europe that have been shaped by a very bad year in tech.

Launched in 2017, El Salvador’s Hugo gave global delivery giants like Uber Eats a run for their money in its home market. By 2021, it had raised more than $13.7 million in venture capital funding, expanded to six countries, and registered more than 14,000 drivers. But on January 4, 2023, Hugo’s founders announced that the company would cease operations in El Salvador. Following the global crunch in tech funding, its parent company Delivery Hero, which acquired Hugo in 2021, decided to fold the company into a local competitor, PedidosYa.

Africa’s first unicorn had a bumpy 2022. Lagos-based Jumia is the continent’s biggest e-commerce company, with millions of users. But it’s struggling to turn a profit. Last year, it let go of roughly one-fifth of its workforce, and now it has lost nearly 70% of its value compared to its 2019 IPO. Jumia’s struggles have analysts wondering aloud whether the e-commerce business model will work in Africa. “While the firm sold an ‘Amazon of Africa’ narrative that appealed to Western investors, the reality on the ground never backed that up,” Emeka Ajene, an independent tech analyst, told Rest of World in February.

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