Vendease, a Y Combinator-backed Nigerian food procurement firm, restructured its employee compensation scheme on Tuesday.
This move follows a substantial reduction in its workforce, with 44 percent of employees laid off, amounting to around 120 staff members.
The company has transitioned from traditional fixed salaries to a performance-based pay system, complemented by an Equity Share Option Plan (ESOP).
Read also: Vendease cuts 120 jobs in latest round of layoffs
Vendease rolls out five-phase salary recovery
Vendease’s new compensation model includes a five-phase salary recovery plan. In February, all employees received a flat ₦140,000 (~$90), regardless of their previous salary.
From March to May, employees can earn up to 30 per cent of their former salaries if they meet performance targets, though these targets have not been clearly defined.
Compensation will increase to 60 per cent from June to August and 90 per cent from September to November, with complete salary restoration expected by December, contingent on company and employee performance goals.
The unpaid portions of salaries will be converted into share options under the ESOP, with 50 per cent vesting over ten months and the rest over three years.
“We only spend what we earn, which keeps us consistently at break-even and focused on profitability,” a company spokesperson explained. This restructuring is part of Vendease’s broader strategy to become more financially sustainable by focusing on software-driven growth rather than capital-intensive logistics operations.
Vendease eyes bridge funding for tech expansion
Vendease is currently seeking fresh capital to support its transition and expansion plans. The company aims to raise a bridge round to fund technology growth and expansion rather than operational expenses.
This strategic shift includes doubling down on its sales and payments solutions and credit marketplace, particularly its Buy Now, Pay Later (BNPL) product, which has become a key revenue driver.
Read also: Jumia Food abandons Nigeria, other African countries
Vendease claims a default rate of under 1 percent for its BNPL product and has disbursed over $70 million in credit since 2024.
The company’s decision to focus more on software solutions reflects a broader trend among Nigerian startups, which are increasingly moving away from asset-heavy models in favour of technology-facilitated efficiency.
Despite facing economic challenges such as the sharp depreciation of the naira and rising inflation, Vendease remains committed to streamlining food procurement for African restaurants and food businesses.