OyaPay

Offline payment solution.

Epitaph

“Here lies OyaPay. It let offline Nigerian businesses take payments and forward orders, with or without a smartphone. When outside capital was needed, the founder and his sole family investor spent months unable to agree on diluting one stake. The impasse never settled, and in February 2019 he called it quits.”

Overview

Born: 2017 (Year)
Died: February 2019 (Month)
Lifespan: 2 years
Fate: Shut down
Headquarters: 🇳🇬 Nigeria
Category: Fintech
Stage at death: Seed
Primary cause: Founder or team
Contributing causes: Funding or runway

Death certificate

Timeline

December 2017Founded
OyaPay launches December 1, 2017 as an offline payments platform
2018OyaPay operates on seed capital from a family investor rather than external funding
February 2019Unresolved dispute over equity dilution with the family investor leads founder Abdulhamid Hassan to shut the company down
March 2019Hassan publicly details the family dispute behind the shutdown

Autopsy report

Why did OyaPay shut down?

Nigerian offline-payments startup OyaPay shut down in February 2019 after a months-long, unresolved dispute between founder Abdulhamid Hassan and his uncle (the company's sole family investor) over equity dilution needed to bring in outside capital.

What OyaPay attempted

OyaPay, launched December 1, 2017, built a mobile point-of-sale/payments platform so offline Nigerian businesses could accept payments and take forward orders with or without a smartphone, competing with the likes of Paystack and Flutterwave.

Early warning signs

Founder Abdulhamid Hassan deliberately avoided external capital until achieving product-market fit; when the company needed to raise external funding, months of unresolved disagreement with its sole family investor (an uncle) over stake dilution followed.

What happened

Hassan had funded OyaPay's early growth with a small seed investment from a family member rather than outside investors. When the company later needed to raise external capital, the family investor refused to allow dilution of his stake. The impasse went unresolved for months until Hassan, frustrated, decided to shut the company down in February 2019, promising refunds of user wallets and merchant balances; some staff, including Hassan, subsequently joined Paystack, though Paystack said this was not an acquisition.

Lessons for future builders

A cap table that lets one early backer block new investment can strangle a company that needs to raise. Agree on dilution rights and future-round mechanics in writing before taking money, especially from family.