In Memoriam: Reflecting on the Startups We Lost in 2023
As we bid farewell to 2023, reflecting on the startups that didn’t make it through the year is poignant. Contrary to the dramatic tales of companies like FTX or Theranos, most startup failures are quieter, often due to timing, funding issues, or macroeconomic factors. This year, around 3,200 private venture-backed U.S. companies shut down, collectively having raised over $27 billion.
A few notable startups among them include:
- Braid (Founded 2019 – $10 Million Raised): This innovative shared wallet startup aimed to simplify pooling and managing money among friends and families. Despite its potential, Braid shut down, with founder Amanda Peyton sharing candid insights into its challenges and demise.
- CloudNordic (Founded 2007): A victim of a devastating ransomware attack, this Danish cloud hosting provider couldn’t recover after losing all customer data, leading to its closure.
- Convoy (Founded 2015 – Over $1 Billion Raised): Despite its impressive funding and valuation, the digital freight broker abruptly closed its doors. However, its legacy continues somewhat, as Flexport acquired its assets.
- Daylight (Founded 2020 – $20 Million Raised): This LGBTQ+ banking platform ceased operations amid legal controversies and market challenges, underscoring the difficulties neobanks face targeting specific demographics.
- Fuzzy (Founded 2016 – $80 Million Raised): The pet care telehealth startup unexpectedly shuttered, leaving many, including its executives, puzzled over its rapid demise.
- IRL (Founded 2016 – $200 Million Raised): Despite its high valuation, the social event-organizing app shut down following revelations about the prevalence of bot accounts among its users.
- IronNet (Founded 2014 – $400 Million Raised): Founded by former NSA director Keith Alexander, this cybersecurity startup couldn’t withstand market forces and poor leadership, leading to bankruptcy.
- Mandolin (Founded 2020 – $17 Million Raised): This concert live-streaming platform rose swiftly during the pandemic but eventually had to close, a reminder of the volatility in the tech startup landscape.
- Veev (Founded 2008 – $597 Million Raised): A tech-enabled prefab homebuilder, Veev faced an abrupt end, showcasing the unpredictability of startup success, even with substantial funding.
- ZestMoney (Founded 2015 – $121 Million Raised): This Indian fintech startup, unable to sustain its growth trajectory, shut down following unsuccessful efforts to raise funds and find a buyer.
- Zume (Founded 2015 – $445 Million Raised): Known for its pizza-making robots and later sustainable food packaging, Zume’s varied journey ended with liquidating its assets.
These closures highlight the often harsh reality of the startup world, where success is never guaranteed, regardless of the initial promise or funding.