The Kenyan startup scene, known for its dynamism and innovation, is plagued by a range of unethical practices that deeply impact the well-being and professional growth of workers. From toxic work environments and unfair treatment to delayed payments and misappropriation of funds, the challenges faced by employees within these startups are concerning. It is crucial to shed light on these issues and advocate for a more transparent, fair, and accountable entrepreneurial ecosystem in Kenya.
Workers in Kenyan startups often find themselves in toxic work environments characterised by a lack of work-life balance, micromanagement beyond working hours, and reliance on incompetent oversight. Unfair treatment compounds their frustration, as some workers face contract discrepancies, unequal compensation, and double standards. Furthermore, delayed salary payments, threats against workers and ex-workers, paying for positive media coverage, and swindling investors further undermine trust and create a hostile atmosphere. Addressing these challenges is essential to foster a work environment that values integrity, transparency, and fairness, allowing for sustainable growth and success in the Kenyan startup industry.
Welcome to my first article among many to come on the Dark Side of Kenyan Startups where I will be elaborate in addressing the issues I discovered on a first hand experience as well as from the experience of others who spoke to me recently.
1. Creating a Toxic Work Environment
a. No Work-Life Balance: One prevalent issue within many Kenyan startups is the lack of work-life balance. Employees often find themselves grappling with excessive work hours, unrealistic deadlines, and limited personal time. This imbalance can result in burnout, decreased productivity, and adverse effects on physical and mental well-being.
b. Relying on Incompetent Workers to Oversee Operations: Another frustrating aspect for workers is the reliance on incompetent individuals, such as project managers (PMs), tech leads, and human resources (HR) personnel, to oversee crucial operations. For instance you will find someone made to be a CEO or PM in a startup which has software developers in part of it’s workforce and yet the person has zero knowledge on how to handle them. Probably he or she is from the banking sector but has been mandated to manage a team of developers and designers. Inadequate leadership and management skills can hinder progress, hinder effective communication, and lead to confusion and frustration among employees.
c. Micromanagement Beyond Working Hours: Micromanagement is a common problem in Kenyan startups, often extending beyond traditional working hours. Workers may find themselves constantly monitored, questioned, and micromanaged even when they are not officially on duty. This excessive control stifles creativity, undermines trust, and impairs job satisfaction.
2. Giving Unfair Treatment to Workers
a. Unequal Contract Distribution: Some startups exhibit unfair practices by withholding contracts from certain workers or offering them unfair contractual terms. This disparity creates a sense of insecurity and undermines the trust between the employer and employee. It can also lead to a lack of legal protection and limited access to benefits and entitlements.
b. Underpayment and Disproportionate Compensation: Workers often face discrepancies in compensation, with certain roles receiving disproportionately lower salaries compared to their counterparts. For instance, employees involved in coding, debugging, and bug fixing may receive significantly lower remuneration than those in marketing and public relations. Such inequities create dissatisfaction, demotivation, and hinder talent retention.
c. Promoting Double Standards: Startups may exhibit double standards by allowing some employees to travel extensively while others bear the brunt of demanding workloads. This unequal treatment can foster resentment and lower morale among employees. Additionally, instances of certain workers engaging in personal activities during work hours, such as watching Netflix or browsing YouTube, further exacerbate the perception of bias and unfairness.
3. Failing to Pay Workers on Time
a. Citing Project Overspending as an Excuse: In some instances, they may delay salary payments by falsely claiming that the project has exceeded its budget. This tactic is often used to buy time and shift the blame, despite the availability of funds. Such delays in payment create financial hardships for workers and erode trust in the organisation.
b. Requesting Pay Cuts or Unpaid Work: Workers are sometimes put in a difficult position where they are asked to accept pay cuts, sometimes as drastic as half of their usual salary, or even work for free for extended periods, such as two months. These demands further exacerbate financial strain and undermine the value and dignity of employees’ work.
4. Misappropriating Investors’ Funds
a. Personal Use of Investor Funds: Senior workers in some startups may misuse investors’ funds for their personal gain. This can involve purchasing luxury items, such as cars, or funding extravagant travels around the world. Such actions not only demonstrate a lack of integrity but also divert resources that should be invested in the growth and sustainability of the startup.
b. Gambling and Speculative Investments: Rather than utilizing investor funds responsibly, some startups may engage in risky activities such as gambling or speculative investments in trading and cryptocurrency. These ventures often lead to significant financial losses, leaving the company unable to pay its workers for prolonged periods. Such mismanagement of funds adversely affects employees who rely on their salaries to meet their basic needs.
5. Failing to Communicate Critical Information to Workers
a. Abrupt Changes in Project Timelines: The incompetent top management sometimes fail to communicate changes in project timelines effectively. This can occur due to investor recommendations or demands, causing sudden shifts in project goals and deadlines without providing prior warning to the workers involved. This lack of transparency creates confusion, disrupts workflow, and undermines the trust between the management and employees.
b. Delayed Salary Payment Notifications: One common issue experienced by workers is the lack of advance communication regarding delayed salary payments. Instead of informing employees in a timely manner, startups often only communicate the delay after it has already occurred. This lack of transparency adds to the financial uncertainty faced by workers and makes it challenging for them to plan their finances effectively.
6. Indefinite Termination of Contracts: Layoffs
a. Arbitrary and Unwarned Layoffs: Workers in Kenyan startups often face the risk of sudden and arbitrary termination of their contracts. These layoffs can occur without any prior warning or explanation, leaving employees in a state of uncertainty and financial instability. In some cases, this action is taken as punishment for speaking up against unfair practices, while in other instances, it may be part of general cost-cutting measures.
7. Threats Directed at Workers and Ex-Workers
Workers and ex-workers who dare to speak out against the unethical practices within Kenyan startups have been subjected to various forms of intimidation. These include threats of legal action, often through the use of lawyers, in an attempt to silence dissent and prevent exposure of the company’s wrongdoings. Such actions create a hostile work environment and discourage open dialogue.
8. Paying for Positive Articles and Reviews
Kenyan startups have been known to engage in unethical practices by paying journalists and bloggers to write positive articles and reviews about their organisations. This tactic aims to manipulate public perception and create a false image of success and credibility. By deliberately influencing media coverage, these startups distort the truth and deceive potential customers, investors, and the general public.
9. Swindling Investors
a. Pitching Non-Existent Products or Services: Certain startups in Kenya have resorted to pitching ideas or products that lack substance or tangible outcomes. They secure investor funding based on promises that they cannot fulfill or deliver upon. This deceptive practice not only misleads investors but also jeopardizes the financial stability and reputation of the startup when they are unable to actualize their initial proposals.
b. Imitating Existing Ideas and Struggling to Compete: Some startups pretend to be innovative and unique during the funding stage, only to realize later that their ideas are not novel but already exist in the market. After securing investment, they face difficulties in outperforming or differentiating themselves from established competitors. This misrepresentation misleads investors and ultimately undermines the startup’s potential for success.
Conclusion:
The challenges faced by workers in Kenyan startups go beyond toxic work environments and unfair treatment. Indefinite termination of contracts, threats against workers and ex-workers, paying for positive media coverage, and swindling investors are additional unethical practices that further erode trust, fairness, and transparency within these organizations. It is crucial for startups to prioritize integrity, ethical conduct, and accountability to build a sustainable and responsible entrepreneurial ecosystem in Kenya. By addressing these issues, startups can create an environment that fosters trust, attracts quality talent, and facilitates genuine innovation and growth.
If you would like to get more context to claims in this article please contact me on my twitter handle @JaxiroKe. I will surely address your valid questions or concerns. We are here to help each other on the dangers that coexist within us in the Kenyan Startup ecosystem.
