For every success story in the FinTech sector, there are a vast list of firms that crashed and burned their way out of existence – a common part of the competitive world of business. In a particular tough economic year, there were a number of financial companies that we will be leaving behind in 2023.
Research by CB Insights detailed that this year has been particularly rough on startups, with funding drying up considerably. The research found global funding fell 34% from 2021 to 2022. Three-quarters of the way through 2023, funding only sat at $193.6B, less than half of 2022’s year-end total.
Here are some of this year’s failures.
Koyo Loans
A particularly rough casualty in the UK FinTech market was the closure of Koyo Loans, a credit solution and debt recovery firm.
Koyo was originally created to furnish loans to customers who found it tough to secure access to credit through conventional means by using AI and open banking data to gain a so called ‘information advantage’ over other banks and lenders for a more accurate risk assessment.
Prior to its demise, Koyo Loans had raised a total of £178m in investment – with the firm pulling in just last year a £100m credit facility and £5m top-up on its Series A.
Casai
Mexico-based PropTech firm Casai closed its doors earlier this year, after it had laid off dozens of its employees last year in signs of things to come.
The company claimed to curate boutique travel apartments in some of the best neighbourhoods across Latin America, ‘delivering first-class comfort and a seamless guest experience powered by cutting-edge tech’.
Casai had previously raised $28m in equity funding from 2020 to 2022, and had secured $25M in debt financing as well.
Multichain
Based in Singapore, Multichain was a company focused on the growing blockchain sector, with the firm helping organizations to build and deploy blockchain applications with speed. The firm provides interconnect infrastructure for 25 mainstream public blockchains.
Back in 2021, the firm raised $60m in a round of financing at a $1.2bn valuation – making the company a unicorn.
Clim8
While sustainability-focused firms are growing in stature as 2023 comes to a close, one sustainability firm that has come to a complete close is Clim8.
Clim8, a sustainable investment app, shut down in March. The firm was focused on helping retail consumers invest in companies and funds working to combat the climate crisis.
While the firm had previously secured $20m in funding over a number of early-stage rounds, the startup had continued to struggle to bring in new capital.
TenureX
TenureX, a correspondent banking platform, closed in Feburary this year. The Tel-Aviv-based firm claimed that it freed banks and other types of financial institutions from the constraints of rigid and complex correspondent banking relationships.
Despite the firm stating that it had established product-market fit, this wasn’t enough to keep it from going under in the late winter.
GloriFi
GloriFi, a Conservative-leaning neobank that was billed as a ‘bank for the anti-woke’ shut down in November 2023, only two months after its original turbulent launch.
The firm had received considerable investor attention, with the company announcing a $1.7b SPAC merger deal in July last year. Despite this, the firm ran into a number of issues related to product development, workplace environment and vendor disputes.
Fronted
Fronted, a UK-headquartered rental deposit startup, also shuttered its business in August this year after three years in existence.
Prior to closing, Fronted had raised £28m in total funding. Fronted was founded to help renters spread the cost of deposits over several months, and later on its life offered a ‘lifetime deposit’ which moved with renters between properties.
ProntoPiso
ProntoPiso – a firm that started out as a digital real estate agency with the aim to sell a client’s property within 90 days, otherwise it would pay the owner 95% of the property’s market value – began its winding down process in the middle of October.
The company had previously secured $5m in equity funding in its first couple of years of existence. ProntoPiso had pivoted to functioning as a platform for real estate agents later in its life.
Akudo
India-based firm Akudo also failed this year. Akudo was a digital bank for teenagers in India that gets them their own personalized prepaid card that they can use independently, providing them the chance to save money and give them rewards under a gamified setup when they’re good at their personal finance.
The company had previously bagged $4.2m in seed funding in 2021, but officially closed its doors in December.
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