Hover transitions to an open source community
Due to its inability to raise additional funding, Hover—the parent company of Stax, says instead of shutting down, it is transitioning from a "full-time team to an open source community".
Six years after Hover launched to provide an android software development kit (SDK) for developers to embed USSD into their apps, the company says it is transitioning from a "team to an open source community" due to its inability to raise additional funding amidst the economic downturn.
"We failed to achieve scalable economics and have not been able to raise additional capital. We must now take drastic measures to keep our vision and work alive," Ben Lyon, CEO at Hover, said in a statement seen by Benjamindada.com.
Effective May 1, 2023, Hover will not have full-time employees. It will continue to offer its services through the support of volunteers. "As finances allow, we hope to be able to engage open source contributors and former teammates as consultants for specific, short-term projects that serve the community and ecosystem," Ben added. At least 20 of its employees who reside in Nigeria, Kenya, US and UK, per LinkedIn data, will be laid off.
"If your organization is hiring, I stand by teammates past and present and am happy to provide introductions and/or references," he added.
The CEO says he continue to perform administrative duties at the company.
Hover is the parent company of Stax, a universal money app that received $500,000 from SDF Fund to enable borderless payment in Africa, last year. Prior to this investment, Stax raised $2.2 million in a seed extension round in the same year. Currently, Stax supports over 100 bank and mobile money services across sub-Saharan Africa and has been used by more than 250,000 people.
Aside from Stax, Hover has launched other products including Android SDK and developer dashboard, a monitoring and test automation app for USSD-based services and a universal USSD directory.
"We have updated our Android SDK pricing and will enforce billing from May 15, 2023 to cover these server costs and ensure service continuity for SDK users," Ben disclosed.
Related Article: Using USSD-technology, Stax wants to increase financial inclusivity for Africans
As the days go by, the impact of the venture funding winter has continued to hit the African tech ecosystem. Last quarter, venture funding for African tech startups plunged by 36.8%, compared to the same period last year.
Earlier this month, Nigerian crypto and web3 company, Lazerpay shut down its operations, following its inability to raise additional funding.
Web3 is a sector that Stax was eager to explore this year, with the goal of becoming a multi-asset web3 wallet to support international transactions and also launch a self-custody USDC wallet, which will allow users to transfer money to anyone with a public address.
However, the industry has been badly hit and several crypto and web3 startups have been forced to close, downsize teams or pivot.
"This is not the outcome any of us wanted," Ben adds.