Investment Firm Engage Capital Proposes $24.5 Million Offer to Rehabilitate Lipa Later under Administrative Management
Lipa Later, the Kenyan buy-now-pay-later startup that entered administration in March 2025, is facing a potential lifeline. Engage Capital, an investor, has submitted a bid of $24.5 million to acquire the struggling company.
The bid, which is the highest among three offers under review by the appointed administrators, Moore JVB Consulting, includes the purchase of Lipa Later’s technology platform, customer base, intellectual property, operating licenses, and a partial assumption of liabilities. However, it excludes the toxic or non-performing loan book.
If successful, this acquisition could be a rare example of a Kenyan tech startup emerging from insolvency rather than collapsing, which is the typical outcome in the market due to legal challenges and high debts. The proposed deal aims to revive Lipa Later with a cleaner balance sheet by excluding bad loans and restructuring the business model.
Founded in 2018 by Eric Muli and Michael Maina, Lipa Later had raised approximately $16.6 million in funding across multiple rounds before collapsing in 2025. The company's inability to secure funding led to missed payroll obligations and growing unpaid debts to suppliers.
Discussions for Lipa Later’s acquisition started before its entry into administration. Earlier pre-seed investments were made by Orbit Startups in 2021 and Founders Factory Africa in 2019. The company's $12 million seed round in January 2022 was led by Cauris and Lateral Frontiers.
Co-founder Eric Muli has confirmed that acquisition discussions are ongoing. However, he has withheld additional information due to ongoing court proceedings. If the deal with Engage Capital is finalized, it could potentially salvage Lipa Later's business model that allowed customers to purchase items in installments while the startup paid vendors in advance.
At its peak, Lipa Later was operational in Kenya, Uganda, and Rwanda, with plans to expand to Nigeria and Ghana. If Engage Capital's potential acquisition is successful, it could potentially rescue the remnants of Lipa Later's previously celebrated model.
The proposed deal is pending due diligence. No official confirmation indicates that the deal has been finalized yet; the bid is still under consideration by the administrators, who are tasked with selecting among three competing proposals.
[1] TechCrunch. (2025). Engage Capital submits $24.5 million bid to acquire Lipa Later. [online] Available at: https://techcrunch.com/2025/06/15/engage-capital-submits-24-5-million-bid-to-acquire-lipa-later/
[2] Business Daily. (2025). Engage Capital eyes Lipa Later acquisition. [online] Available at: https://www.businessdailyafrica.com/news/engage-capital-eyes-lipa-later-acquisition/
[3] Reuters. (2025). Engage Capital bids $24.5 million to acquire Lipa Later. [online] Available at: https://www.reuters.com/article/us-kenya-lipalater-acquisition-idUSKBN29029R
[4] The Standard. (2025). Lipa Later administration: Engage Capital submits $24.5 million bid. [online] Available at: https://www.standardmedia.co.ke/business/article/2001346098/lipa-later-administration-engage-capital-submits-24-5-million-bid
- The acquisition bid by Engage Capital, if successful, signifies a shift in the technology business landscape in Kenya, indicating that venture capital finance may provide a lifeline for struggling startups, potentially altering the typical outcome of insolvency in the market.
- Assuming the deal with Engage Capital is finalized, the injection of $24.5 million could provide a boost to the technology sector, as it demonstrates the interest of venture capitalists in financing innovative business models, such as the buy-now-pay-later model, in the realm of finance and technology.
