Why We Stood by Kubik: When Discipline Matters More Than a Good Story

There are many great mission statements behind promising startups. You learn to listen past the headlines for the thing that tells you whether a company has depth—which almost always comes alive in the person of the founder. The genesis of many startups is a personal story that moves someone to work on a problem. Kubik was no different. Its founder, Kidus Asfaw, had worked for UNICEF across more than forty countries and had seen firsthand how waste could be transformed into building materials that breathed life into communities. His conviction was clear from the start. He was not trying to convince me that Kubik would work. He had already decided it had to—and was looking for the right investors to back him on the journey.

Conviction is necessary, but it is not sufficient. A mission does not become a business without the right structure, support, and execution. And nowhere is the distance between the two longer or less forgiving than in the African operating context. That gap—between a founder with a great mission and a company that delivers on it sustainably—is where ARV believes it can help. We backed Kubik’s mission and committed to helping build the business underneath it.

A Problem Worth Solving

We ask one question before any other: is the problem worth the company’s life? In Kubik’s case, the answer was immediate.

Ethiopia generates 16.6 million tonnes of waste annually. Less than 5% is diverted from landfill. Most is openly burned or dumped. The people closest to this waste—overwhelmingly women—work informally, without safety, stability, or upward mobility. Meanwhile, Ethiopia’s cement sector imports $220 million worth of coal every year, and fuel accounts for 30–40% of production costs—all of it draining hard currency from a forex-constrained economy.

Two crises. One root cause. No system existed to capture the value locked inside the waste.

Kubik’s original idea was to build a formal supply chain around the women already doing the work, turning plastic waste into bricks as an affordable alternative to conventional building materials. The company called this “Building Dignity.” In its first year, hundreds of women joined as formal participants rather than remaining invisible to the supply chain. It felt good. The first part of the mission was becoming real.

Now the question was whether it could also become a business.

What 2024 Actually Looked Like

By late 2024, that question did not have a comfortable answer.

The bricks—the product that had won Kubik Startup of the Year, that had rallied supporters around the world—were not selling. As Kidus later put it to our investors: “People loved our bricks. They would love to buy our bricks. But they were not willing to pay twice the amount compared to conventional materials.”

The economics had turned hostile. When Kidus started Kubik, cement in Ethiopia cost 2,100 birr per 100 kilograms. By 2024, a new mega cement plant had crashed the price to 700–900 birr—a drop of more than half. At the same time, Kubik’s primary feedstock, plastic waste, had risen from 12 birr per kilo to nearly 95. The math was devastating. Monthly burn had reached $165,000. Total revenue for the year was $39,000. Runway was under six months.

Kubik is far from the only African startup to face this valley. I have watched many companies die in the gap between a product that works in theory and a business that is sustainable in practice. The African operating environment punishes undisciplined execution: foreign exchange is a perennial constraint, imported equipment arrives late, government approvals keep their own clock, available capital is thinner than the ambition it funds, and the patience attached to it is thinner still.

Many investors treat moments like these as the signal to retreat. One of Kubik’s investors did exactly that. At ARV, we take the opposite view. Where we see a real problem, a capable founder, a team willing to face hard truths, and a potentially great business, we invest more effort—not less.

The Founder’s Reckoning

What happened next is best told in Kidus’s own words. Speaking to our investors recently, he was disarmingly honest: “I found myself stuck around the story. Stuck trying to convince the world that I was right, that this business would work. Someone told me later that the journey isn’t about convincing people you’re right—it’s about demonstrating that you’re learning and evolving.”

There was a deeper reckoning, too. Kidus is a father of three. Relocating full-time to Addis Ababa to embed himself in the daily operations meant real sacrifice. He admitted to our investors something founders rarely say out loud: “There was a moment where I wasn’t sure if I could continue. It was straining. There was a lot of self-doubt. I felt like I was climbing a cliff and I’d never rock-climbed before.”

What pulled him through was a question he asked himself: why did you start Kubik in the first place? Was it really about the bricks?

“I always tell my kids that I want them to remember me for having given a damn about their future. And I still felt like I gave a damn. That was worth the sacrifice.”

At ARV, we have learned to look for particular signals in founders who survive. The winning ones are not those who insist the original plan is intact while the wheels are coming off. They are the ones who sit across from you and tell you precisely where it is broken—and ask for support. Kidus did exactly that.

Governance as Partnership

When ARV took an active role in chairing Kubik’s board in December 2024, we were clear about what that role was not. It was not to run the company from the boardroom. We have watched investors do exactly that under the language of “support”—and watched it erode trust between founders and investors at the precise moment when founders most need to be trusted.

Our job was to bring the depth of expertise around Kidus that a company in Kubik’s position needs and rarely has: governance, operating discipline, financial structure, and the experience of having sat with other companies through the same stretch. Not to dictate the path, but to ensure that when the team charted one, it had the best possible chance of holding. An active board seat, in our view, widens a founder’s options rather than narrowing them.

Over the course of 2025, we reexamined business fundamentals from the ground up. We visited the factory. We walked the dump sites. There were many informal calls beyond the scheduled board meetings—a rhythm built on the mutual trust that comes when both sides commit fully to the same outcome.

The pivotal moment was a board strategy meeting in Addis Ababa in June 2025. Kidus and his team arrived with a 136-page strategy document—detailed, surgically analytical, the product of a founder who had become, in his words, “super detail-oriented around the entire business.” Buried inside was a phrase that became the company’s new rallying point: “maximizing value from waste.” Kubik would no longer define itself by a single product. It would become a diversified waste-to-value platform.

The Question That Changed Everything

The breakthrough came from a deceptively simple question. To make a brick, Kubik was buying plastic, washing it, crushing it, melting it, and forming it. Kidus asked his team: at every step of that process, can this thing be sold? And if so, how big is the market? Is it profitable?

They went out and validated. They literally took loose plastic and asked if someone would buy it. Then, crushed plastic. Then, baled plastic. Then, pelletized plastic. The margins told the story: roughly 100% on baling, growing with each processing step—until the final step, bricks, where margins turned negative.

Then came the second insight. Kubik had secured a 15-year exclusive concession over the municipal landfill in Harar. But only 10% of the waste stream was plastic. What about the other 90%?

A board member who oversees one of Ethiopia’s largest cement factories suggested they look into refuse-derived fuel—RDF. Kubik handpicked 24,000 kilograms of municipal waste and sent it to the factory to be burned and tested. The data that came back was transformative: the fuel was significantly cheaper for the cement producer, it required no US dollars to procure unlike imported coal, Kubik’s margins looked strong, and every tonne of RDF avoided roughly 1.2 tonnes of CO₂ emissions.

Then they sized the market. Ethiopia’s cement industry spends $220 million annually importing 1.16 million tonnes of coal. The national thermal substitution rate is just 2%, compared to 60–80% in mature markets. Cement producers would prefer alternatives if they could get them. The constraint was not demand—it was supply.

Where Kubik Is Now

In January 2026, Kubik paused bricks—the product that had defined the company’s identity from day one—and led with RDF.

About a month later, Dangote Cement, the largest cement producer in Africa, signed an offtake agreement for up to 200 tonnes per day of RDF, representing over $3.5 million in contracted annual demand. A pilot with National Cement had already validated 30–35% coal substitution at equivalent energy quality. Kubik also added processed plastic resale at 45% gross margins and secured Verra plastic credit certification as a fourth revenue line.

On the supply side, Kubik now holds two exclusive municipal landfill concessions: the original 15-year PPP in Harar, operational since 2024 with over 800 women collectors onboarded, and a second in Dire Dawa secured in early 2026 with 361 tonnes of daily feedstock. These concessions—which take two to three years of government relationship-building to win—lock in supply that no competitor can replicate quickly.

The numbers tell the transformation story. Monthly burn fell from $165,000 to $12,000. Annual revenue grew from $39,000 to nearly $400,000. Gross margins moved from deeply negative to the 45–68% range. Headcount was right-sized from 65 to 18. Cash runway extended from under six months to over 21 months.

This is not a finished story. But Kubik is now, unmistakably, a business—one where the mission is carried by the model rather than propped up by it.

Why This Reflects How We Invest

At African Renaissance Ventures, we back founders who understand their markets from lived experience—who are building hard things in places most capital ignores. We back them with capital, and then we work alongside them. We take real board roles. We bring governance, financial structure, and operational depth. We do not impose decisions. We make it possible for a founder to make the hard calls knowing the right support is there.

The Kubik story illustrates what this means in practice. When the original model faltered, we did not walk away. We leaned in— to ensure that a capable founder with a viable vision had the structure, the data, and the strategic clarity to rebuild.

Kidus and his team deserve the credit. They accepted painful truths, executed with speed, and rebuilt their company. Speaking to our investors, Kidus said something that stayed with us: “There have been very few people who privately gave me hard criticism but publicly gave me grace.” That is what we aspire to be.

We read Kidus’s determination correctly, put our weight behind a mission worth building, and rolled up our sleeves when the work was hardest. That is the job. And we are not finished yet.

The author is a Venture Partner at African Renaissance Ventures and Chairman of the Board of Kubik Inc. African Renaissance Ventures invests in early-stage technology companies in East Africa.