By Godwin Olawale
At the peak of 2021 crypto optimism, experts argued that Africans had to participate in the crypto economy, create products, and educate a continent of young people on a future that Web3 was sure to dominate. Those arguments led to the launch of startups like Mara (CoinMara Inc), a pan-African exchange that set out to “build Africa’s crypto economy.” Founded by Chinyere ‘Chi’ Nnadi, Lucas Llinás Múnera, Kate Kallot, and Dearg OBartuin in 2021, Mara was a hit with investors.
In May 2022, it raised $23 million from Alameda Research, the trading arm of FTX, Coinbase Ventures, and 100 other investors at a pre-money valuation of $70 million.In a stunning reversal of fortunes that took only two years, Mara ran out of cash, with CEO Chineyere Nnadi registering a new entity named Jara in early 2024. Two cofounders who left the company in early 2023 claim that Nnadi only established the new company, Jara to avoid responsibility for Mara’s liabilities.“Mara could have been something extraordinary, but its CEO took it down a dark and rotten path,” those co-founders said in a note to investors.Chinyere Nnadi did not respond to multiple requests for comments for this article.
With $5 million left in cash by the end of 2022, Mara began fundraising talks in 2023.Failure to raise follow-on funding worsened problemsMara’s timing could not have been worse. The end of ZIRP and the 2023 crypto winter made it difficult to raise cash. The departure of three of Mara’s cofounders effectively left only Nnadi running the company, and those exits spooked investors, one person claimed. Despite speaking to several investors for a possible $2-5 million raise, nothing materialised. Mara also faced problems with its Mara Wallet, despite its 4 million-users claim. “At least 75% of the 4 million verified users Mara reported it had were fraudulent accounts,” one former executive said. “The financial incentive of the company’s referral program encouraged users to create fake Mara wallet accounts.“Bogged down by financial problems and a poorly received Mara Wallet, Nnadi registered a new crypto company called Jara.
By April 2024, Mara was no more, and in its place, there was Jara. “Mara no longer exists,” said a Telegram message from an anonymous community manager, who urged the nearly 10,000 users in the Mara Telegram group to download the new Jara app—a non-custodial crypto wallet. Users were told, “The company’s investors are aligned with the new vision.” Coinbase Ventures, one of its most prominent investors, did not immediately respond to comments.While the company’s 2022 financial statement showed directors earned a combined $2.6 million, it is unclear how much Nnadi drew as salary. Of five C-suite executives excluding Nnadi, three earned $170,000 each, a fourth earned $120,000 while another earned $600,000 annually.
The combined earnings of those five executives were $1.23 million, suggesting Nnadi, the only executive whose salary was not disclosed may have earned as much as $1.3 million. There are also questions about $500,000 donated to Mara Foundation, the startup’s non-profit arm. “The Swiss government has formally launched action against the Mara Foundation,” one former executive wrote to investors. TechCabal could not independently verify that claim.At least two former executives also claim creating Jara is a way to avoid Mara’s liabilities.