Dash CEO placed on ‘indefinite administrative leave’ as Insight-backed startup conducts financial audit • TechCrunch
Prince Boakye Boampongfounder and CEO of Hyphenwhich provides an alternative payment network of connected wallets that allows interaction between mobile money and bank accounts in Africa, has reportedly been temporarily suspended pending an investigation into financial impropriety, according to people with direct knowledge of the situation.
Boampong founded the Ghanaian fintech in 2019 and is one of Africa’s well-known serial entrepreneurs after co-launching OMG Digitala YC-backed Ghanaian media startup, in 2016. For now, the board replaced him with Kenneth Kinyua, the former CEO of Kopo Kopo, a pan-African payments business, who recently joined Dash for a regional leadership role in East Africa. Kinyua takes over the role of interim CEO.
Last March, the Ghana-founded and New York-headquartered Dash raised $32.8 million in equity from, among others, Insight Partners, Global Founders Capital, 4DX Ventures and ASK Capital. The seed round, which sources said valued Dash at just over $200 million, was the second-largest deal of its kind after PalmPay’s $40 million in 2019. It also marked Insight Partners’ first lead investment in an African startup; The $20 billion behemoth participated in Flutterwave’s Series C round in 2021.
Before raising over $30 million, Dash initially wanted to raise a quarter of the money, around $8 million, as its seed round. It had done so by October 2021 on the back of acquiring around 200,000 users and processing $250 million in transaction volume. By March 2022, five months after the first seed tranche, Dash’s total processing volume topped $1 billion and had gained one million users from Ghana, Kenya and Nigeria, Boampong told TechCrunch in the March interview. There is a 4x increase in transaction volume and a 5x increase in the number of users within five months. That rapid growth, combined with the fintech boom of 2020-2021 spilling into the first quarter of 2022, allowed Dash to attract new investors as it reopened and quadrupled its seed round.
In retrospect, however, the growth in user and transaction volume that Dash reported during that short period may not have been entirely above the line, as their growth numbers differed significantly from what TechCrunch typically sees around how other fintechs are scaling in Africa.
In fact, sources told TechCrunch that Boampong was reportedly suspended as CEO for engaging in financial misreporting. However, Dash’s board, in a joint statement, communicated a different angle regarding the former CEO’s current status to TechCrunch. Without commenting or providing specific context on Boampong’s wrongdoing, a board spokesperson said it placed the CEO “on indefinite administrative leave on January 24, 2023, pending a forensic financial audit of the company.” The inspection results could be out within a month, sources say.
In appointing the interim CEO, the board stated that it is “confident in Mr. Kinyua’s leadership and ability to carry out Dash’s mission to create a unified payment system designed to increase the efficiency and accessibility of how Africans transact with digital money.”
Meanwhile, sources familiar with the company’s internal operations claim that executives repeatedly concealed finances at the firm and described a disorganized workplace where employees quit and were laid off at will. TechCrunch reached out to Boampong for comment. The founder — who, according to people with direct knowledge of the situation, sold millions of dollars worth of his shares in a secondary sale, a practice a handful of African founders engaged in during the VC boom of the past two years — did. do not answer.
Dash, a unified payment app that combines mobile money and traditional bank accounts, simplifies transactions for consumers and businesses. Fintech’s playbook is similar to Visa or Mastercard in that it routes payments through banks and phone companies regardless of who issued it. Thus, users from various African countries Ghana, Nigeria and Kenya can link their bank or mobile money accounts to Dash, pay bills and send and receive money to other users while the platform handles currency conversions. The four-year-old fintech generates revenue from processing fees, savings, foreign exchange fees, bill payments and subscription fees.
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