M-KOPA Holdings, the Kenyan-founded and UK-headquartered fintech startup, has been sued in Kenya over allegations of racial bias.
M-KOPA, it’s said that a 2019 restructuring disadvantaged local employees of African descent while protecting the shareholding of foreign and white expatriate staff and investors.
The petition, filed by long-serving Kenyan employee Elizabeth Njoki at the Employment and Labour Relations Court in Nairobi, accuses M-Kopa of implementing a two-tier ownership structure that diluted the equity of African employees and shielded international investors and non-African executives from similar losses.
According to court filings, the restructuring followed concerns by M-Kopa’s board in early 2019 over dilution risks to institutional shareholders — including British International Investment (BII), and Generation Investment Management, co-founded by former U.S. Vice President Al Gore — after a shareholder converted debt into equity.
In response, the board allegedly created new share classes—referred to as “Growth Shares”—primarily allocated to expatriate and white employees, while African staff, who held Ordinary Shares, were either excluded or reclassified as “Minor Holders,” stripping them of access to shareholder information and voting rights.
“The plan systematically removed Kenyan employees from meaningful ownership and participation,” Njoki said in her filing. “Local employees were not invited to general meetings and were denied access to critical shareholder communications.”
Court documents show that the number of Growth Shares rose from 2.7 million in 2019 to over 3.3 million by 2022. Meanwhile, Preferred Shares ballooned from 3.4 million to 12.6 million. Despite these changes, institutional investors maintained a 73% ownership stake due to anti-dilution protections. Over the same period, the equity held by local Kenyan staff reportedly fell from 27% to just 2.6%.
The petition raises broader concerns about governance and accountability in Africa’s venture-backed tech sector, especially amid growing foreign investment in markets like Kenya, often dubbed “Silicon Savannah.” M-Kopa, which provides pay-as-you-go solar power and smartphone financing, has been one of the continent’s most prominent success stories in inclusive fintech.
In a preliminary objection, M-Kopa has asked the court to dismiss the suit, arguing that shareholder matters fall under UK jurisdiction, where the company is incorporated.
This is believed to be the first time M-Kopa’s ownership structure is being formally challenged in Kenya’s Employment and Labour Relations Court. The outcome could set a precedent for how African tech startups navigate local ownership, equity inclusion, and foreign investor influence as they scale across the continent.
M-Kopa has not yet issued a public comment on the lawsuit.
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