On the surface, M-KOPA is the undisputed darling of the African fintech-for-inclusion scene. Just this August, at the prestigious TICAD 9 conference, the company was signing a Memorandum of Understanding with Japanese banking giant Sumitomo Mitsui Banking Corporation (SMBC) to “strengthen financial inclusion efforts in Africa.”
The company, known for its pay-as-you-go model that has provided smartphones and solar power to millions in the “informal sector,” seemed to be at the peak of its powers.
Behind the scenes, however, a bitter fight is brewing. The company is not only battling a lawsuit from a former employee over share dilution but is now facing a formal complaint from one of its own co-founders, Chad Larson, who accuses the board of engineering an “unfair and manipulated” share valuation to buy out Kenyan employees at a pittance.
The Co-Founder’s Complaint
In a formal complaint dated November 6, 2025, and addressed to the CEO of Kenya’s Capital Markets Authority, Chad Larson, CFA, pulls no punches.
Writing as a “co-founder and major shareholder,” Larson alleges the M-KOPA board, in concert with shareholder Sumitomo Corporation (the same entity from the TICAD partnership) and advisor Eden Global Partners, is orchestrating a “deeply concerning and unfair share buyback process.”
The targets, according to Larson, are Kenyan employees who hold shares through the company’s Employee Stock Option Plan (ESOP). The allegation is explosive:
“The valuation used to determine the buyback price appears biased, manipulated, and grossly inconsistent with the company’s actual market position and recent financial performance… The low valuation used, about a 95% discount to the true share price, is to the great benefit of Sumitomo Corporation…”
Larson further alleges that Eden Global Partners is “earning a large fee” deducted directly from the employees’ selling price, ensuring that “Kenyan shareholders will receive very little money” while ownership of their valuable shares shifts to Sumitomo.
The timing is, to put it mildly, awkward. Sumitomo, painted in the complaint as the prime beneficiary of a rock-bottom share deal, was simultaneously being celebrated as M-KOPA’s key partner for promoting “financial inclusion” across the continent.
A $160 Million Context
Larson’s complaint lands just months after M-KOPA was reportedly closing a massive $160 million Series F equity round, also led by Sumitomo Corporation.
According to a July report from ImpactAlpha, that round provided a crucial window into the company’s valuation. New shares in the funding round were valued at approximately $37.02.
Tellingly, that same Series F round included a secondary transaction to provide an exit for early shareholders and employees. In that transaction, ordinary shares — the kind held by ESOP participants — were priced significantly lower at approximately $26.
While a discount between new primary shares and secondary ordinary shares is common, Larson’s complaint suggests the new buyback offer he is protesting is far more severe, branding it a “95% discount.” This implies a valuation dramatically lower than even the $26 offered just months ago.
The Other Legal Battle
Larson’s complaint is not the only fire the company is fighting. M-KOPA is also a defendant in a separate case filed in May in Kenya’s Employment and Labor Relations Court by a former employee, Elizabeth Njoki.
That petition makes similarly damaging allegations:
- It claims a shareholding restructure between 2019 and 2022 resulted in the “disproportionate and irregular dilution” of ordinary shareholders, including the ESOP participants.
- It further alleges the creation of a new “growth share” class was “designed to advantage white and foreign employees and shareholders over Kenyan and other African shareholders.”
This lawsuit dragged in some of M-KOPA’s high-profile impact investors, naming British International Investment (BII) and Generation Investment Management (co-founded by Al Gore) as “interested parties” who “stood to benefit the most” from the alleged dilution.
The Company and Its Backers Fire Back
M-KOPA and its investors have strongly refuted all allegations.
Regarding the Njoki lawsuit, M-KOPA called the claims “baseless, disingenuous and entirely false,” stating flatly, “Racial disparities do not exist at M-KOPA.” The company argues the “growth shares” were allocated based on seniority using a compensation formula from third-party HR consultants, and that the “majority of both ESOP and growth shareholders are of African descent.”
A spokesperson for BII echoed this, calling the legal action “an abuse of process” and stating the “racial discrimination claims have no basis.”
In response to the secondary sale (the one reported in July), M-KOPA employed a classic “free market” defense, noting that the offer gave Njoki’s shares a “6x return” and that no one is obligated to sell.
“The transactions taking place are between willing buyers and sellers,” the company told ImpactAlpha. “If people prefer to hold onto their shares… or if they wish to pursue a claim against us they can.”
Of course, that “willing buyer, willing seller” argument may look different to Kenyan regulators when a co-founder alleges the price on offer has been “manipulated” down by 95%.
M-KOPA, which has raised over $590 million and built its brand on empowering the underserved, now finds itself in a precarious position: lauded in public for its multi-million dollar partnerships while being accused in court and to regulators of squeezing the very employees who helped build its success.