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Banking - as - a - service startupSolid(formerly called Wise ) has filed for Chapter 11 bankruptcy protection , according todocumentsfiled in the United States Bankruptcy Court for the District of Delaware on April 7 .
Founded in 2018 , the fintech society had raised a total of nearly $ 81 million in funding from investors such as FTV Capital and Headline . Solidwasvalued at $ 330 millionas of August 2022 , according to PitchBook , when it announceda $ 63 million Series B round of fundingled by FTV .
Palo Alto - establish Solid work with fintech and vertical SaaS company and offer banking , payments , cards and cryptocurrency merchandise via well-situated - to - integrate genus Apis . The troupe touted itself as “ the AWS of fintech ” andclaimed in August 2022that it had grow 10x in revenue , doubled its customer to 100 and became profitable . It is now in the process of trying to restructure or trade itself , consort to the documents .
“ After considering all options , we ’ve decided that a voluntary Chapter 11 restructuring is the best grade , ” Centennial State - founder Arjun Thyagarajan told TechCrunch . “ We ’re affirmative that the court - supervised cut-rate sale cognitive operation will attract the right buyer , leading to a plus final result for the company , customer , and shareholders . square intend to extend operate its patronage in the ordinary course of instruction through this process . ”
self-colored had not been able-bodied to raise more chapiter since its last funding round and “ faced significant and pricey litigation , ” according to the bankruptcy filings .
In 2023 , Solid was the target of alawsuit filed by Series B investor FTV Capital , which was attempting to get its $ 61 million investment back .
FTV Capital ’s case claimed , among other things , that Solid cobalt - founders Thyagarajan and Raghav Lal “ lied to FTV concerning the company ’s revenues , client churn , and business mostly and further lead astray FTV . ” The business firm also need for Thyagarajan and Lal to give up .
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The inauguration ’s co - founder pushed back , lodge a countersuit against FTV and its spouse Robert Anderson . In it , they discover FTV as “ an aggressive private equity house , ” and claim that “ the moment its investment was no longer profitable , [ the firm was ] resorting to made - up claim of fraudulence , scourge and strong - armed tactics to prove to get its money back . ”
According to the bankruptcy filing , the FTV litigation was dismiss in April of 2024 “ with prejudice under a resolution give by the parties . ”
As of the petition appointment , Solid articulate its majuscule social organization consisted of unsecured trade debt add together close to $ 760,000 with “ a special amount of current tax income ” and around $ 7 million in hard currency on hired man with approximately $ 2 million of that held in non - melted military reserve accounts . It claims to now only have three employees .
The company has filed for failure undersubchapter V , which imposes shorter deadline for filing reorganization plans and let for greater flexibility in negociate restructuring program with creditors .
Solid is not the first BaaS startup to file for failure . Last April , Synapse famouslyfiled for Chapter 11 , hoping to trade its assets in a $ 9.7 million fire sale to another fintech , TabaPay . ButTabaPay walk .
One affair both startups had in vulgar ? Evolve Bank & Trust was a partner bank . Notably , another fintech — Mercury — recently declare that itended its relationshipwith Evolve .
Fintech Business Weekly’sJason MikulaandRK | Consultantsposted about the bankruptcy on X. harmonize to Mikula , Solid ’s 20 largest unsecured creditors include Amazon ( AWS ) , regulatory consulting shop FS Vector , Visa , Plaid , Trulioo , Spade , and a number of constabulary firms .
TechCrunch accomplish out to FTV for comment but had not hear back at the time of writing .
