Africa-based coding accelerator company Andelais laying off 420 junior engineers across three African countries, in spite of raising US$100-million in funding as recently as January.
Launched in Nigeria but also active in Kenya, Uganda and Rwanda, Andela was formed to solve the global technical talent shortage by building distributed engineering teams with African software developers.
The company is one of the continent's most capitalised, taking its total raised funding to US$180-million with a US$100-million Series D round in January of this year, but just nine months on it has announced lay-offs.
In what it calls a "restructuring" of its "talent pipeline" in order to meet global market demand, Andela has announced the departure of approximately 250 junior engineers and staff from its Nigeria and Uganda hubs, with another 170 potentially impacted in Kenya.
The changes come as Andela changes its focus. Having thus far been engaged in training mostly junior level developers, the company says it has become increasingly evident this was not fulfilling market needs, with customers requiring more senior staff.
Jeremy Johnson, Andela's co-founder and chief executive officer, said it was clear the world needed what Andela provides - high-quality engineering-as-a-service - but that it was also evident that the majority of this demand is for more experienced talent.
"To keep up with it, we need to grow our senior talent base even faster," he said. "This shift in demand also means that we now have more junior talent than we are able to place. This is a challenge for the business, and for these junior engineers who want, and deserve, authentic work experiences that we are not able to provide."
Alongside the lay-offs, Andela plans to hire 700 more experienced engineers by the end of 2020.
The company's VP of global operations Seni Sulyman said its immediate priority was to ensure junior staff affected by the changes were well supported to succeed in their next career moves.
"We are in talks with tech leaders across Africa, who have been very supportive in exploring opportunities for these talented Andelans. We are also focusing our attention on providing adequate support for the rest of Andela during this period, as we continue to build a world-class engineering organisation," he said.
The company said it is working with all impacted and potentially impacted employees, and is committed to providing a "holistic professional and financial support package". Andela also said it is partnering with tech hubs CcHUB (Nigeria), iHub (Kenya), and Innovation Village (Uganda) to help connect impacted developers with opportunities in their local ecosystems. Andela will also continue to invest in the Andela Learning Community (ALC).
"Five years ago, we launched Andela to solve a global challenge: Brilliance is evenly distributed, but opportunity is not. To succeed in our long-term mission, we have to make tough decisions to continue growing a company that we know will change the way the world thinks about talent," said Johnson.