A Kenyan court has ruled against Marketforce Technologies, a once-promising B2B e-commerce startup, ordering the company to pay KES 2.1 million ($16,000) to a former employee for wrongful termination. The verdict follows nearly a year after the Y Combinator-backed company shut down RejaReja, its flagship B2B marketplace, leaving its future uncertain. Meanwhile, co-founder Tesh Mbaabu has since moved on to launch a social commerce platform, Chpter.
Tom Maina Chege, a former product manager at Marketforce from January 2022 to August 2023, initiated legal proceedings in October 2023. Chege, who earned a monthly salary of KES 200,000 ($1,550), was laid off in July 2023, with the termination taking effect the following month. He contended that the redundancy was unlawful, arguing that the company failed to observe the legally required 30-day notice period and did not notify the Labour Office, as mandated under Kenya’s Employment Act, 2007.
Chege sought KES 1,560,870 ($12,000) in compensation for unpaid leave, notice pay, severance pay, salary arrears, and general damages. After Marketforce failed to defend itself in court, Judge C.N. Baari ruled that the termination was both procedurally and substantively unfair. Consequently, the court awarded Chege KES 1,316,547 ($10,000) in terminal dues and an additional KES 800,000 ($6,000) in compensation and legal costs.
“The company did not attempt to comply with the seven steps outlined in Section 40(1) of the Employment Act, 2007,” the ruling stated.
The court’s decision offers insight into Marketforce’s internal challenges, which, according to three former employees, began with mass staff departures in late 2022 and 2023. These exits disrupted operations and weakened ties with major distributors.
“Marketforce had a credit arrangement with leading manufacturers that allowed them to secure stock on credit,” a former employee revealed. “However, when financial issues emerged and key staff members left, these agreements fell apart.”
Additionally, the company faced severe cash flow constraints, resulting in salary delays and pay cuts of up to 50% for non-technical staff. Despite securing over $40 million in funding from investors such as Reflect Ventures, Greenhouse Capital, and Century Oak Capital, Marketforce exited the B2B e-commerce sector in 2024, leaving its future uncertain.
While Marketforce’s future remains unclear, co-founder Tesh Mbaabu has pivoted to a new venture, Chpter—a social commerce platform aimed at helping businesses sell via social media. In September 2024, Chpter secured $1.2 million in pre-seed funding, led by Pani, an Africa-focused investment firm co-founded by former Cellulant CEO Ken Njoroge. The company has also joined the Safaricom Spark and Norrsken Accelerators.
Whether Marketforce can recover and re-enter the market remains uncertain. However, its rise and fall highlight the financial and operational hurdles that many African startups face in scaling their businesses sustainably.
