As the founder of Fundid, my journey in reshaping how business owners understand and access capital has been one marked by both triumphs and tribulations. From the initial spark of inspiration in April 2021 to the bittersweet closure in April 2024, Fundid's story is one of passion, perseverance, and growth.

Fundid may have failed as a company, but more than that, we acknowledge that we failed the small businesses that need innovation in capital markets. This realization cuts deep, especially considering that 90% of the businesses we aimed to serve were women-owned. The sting of this failure serves as a constant reminder of the work yet to be done in addressing the systemic challenges faced by underserved entrepreneurs.

Despite the setbacks and challenges, my journey with Fundid has been transformative on a personal and professional level. I've had the privilege of delving into the complexities of the US financial system, collaborating with brilliant minds to explore solutions for small businesses' access to capital. Along the way, I forged deep relationships with lifelong friends, expanded my horizons, and honed my leadership skills.

Working alongside investors has been an invaluable experience. Their unwavering support and guidance have helped me navigate the highs and lows of entrepreneurship, shaping my understanding of myself and my entrepreneurial goals in unexpected ways.

However, the most profound takeaway from this journey is the importance of embracing failure openly. Experiencing setbacks amidst those I sought to impress has been strangely liberating. It's empowered me to pursue ambitious endeavors without fear of the inevitable challenges and setbacks that come with the territory.

As I reflect on Fundid's rise and fall, I'm filled with gratitude for the lessons learned, the relationships formed, and the growth experienced. While the journey may have ended sooner than anticipated, the spirit of innovation and resilience lives on, driving me towards new horizons in the ever-evolving entrepreneurship landscape.

I hope my reflections below are helpful to others.

As for what went wrong

• Time to market BaaS vs. direct - We originally thought we would be able to get to market through a BaaS player but quickly realized our BaaS options had half-baked SMB credit products with limited ability to innovate in underwriting. We weren’t trying to be a better-marketed product of the same old thing, so we were forced into getting our product to market directly with a bank partner. This shift was extremely costly, both in time and money.
• Compromising our product for our partners and letting “smart” people change our underwriting ideas. I had a deep belief that we had to make it easier for small businesses to get access, and for a long time, we held strong to our underwriting model, but when we started looking at businesses to underwrite we were blown away by just how hard it would be to find a model that would let us approve them for our card product. It turns out LOTS of businesses are not cash flow positive, have growth, or are anything close to looking like that. When faced with this problem, I let fear and pressure from our partners take over and started relying too much on experts in the space, which ultimately compromised my vision. That was the moment we were no longer an innovative product. I justified this by telling my team we had to “earn the right to serve the smallest businesses,” but we never would if we didn’t survive. I think this was the wrong decision.
• Interest rates: It has been easy for me to blame interest rates for our failure, and it might even be true. Fintech is all about bps (basis points), and when interest rates went up last year, our unit economics no longer worked…they didn’t work well even when interest rates were low. Because Fundid is a fintech, not a bank, we paid a high price to lend to our users. Between the cost of capital on the debt facility, the cost of collateral capital needed by both the bank and debt facility, and the predicted loss/fraud rate of the space, I just couldn’t get comfortable with the numbers. Additionally, capital vital to our success didn’t work out at this time, so in June of 2023, we pulled our card from the market.
• Losing faith in the venture path. Other venture-backed founders will probably understand this best based on what we all just lived through. The most discouraging part of this journey was feeling like I was executing what I committed to and then the goalposts were moving on me. It was incredibly distracting and demotivating to build a company in a system that constantly changed…what was “in” for VCs to fund, what metrics were needed for the next round, etc. Through this, I ultimately became disgruntled with venture, so keeping my head in the game became hard. As the CEO, I was a fiduciary. Still, I often had difficulty defining exactly who I was a fiduciary to because I constantly felt the self-inflicted pressure to push forward without a clear path to profitability yet still sell my vision to raise more money and I’m not sure that “fake till you make it” is in my DNA. My existing investors are fantastic, this reflects seeking new investment in a market that decided fintech, lending and cards were no longer desirable.

What went right

• The team! I have never loved working with a group of people more than I did the team we had at the end. MaryBeth, Riley, Lamara, Lisa, Kirsten, and Ian– working with you has been the highlight of my career! Not just because they are all fantastic people but because we were efficient, worked hard but had fun, we were willing to dig deep, and all had each others best interests in mind. I’ll never forget our team sitting in a coffee shop in tears not because Fundid wasn’t working but because we wanted to keep working together. I would build (and hopefully will) another company to find a way to work with these awesome people again.

• Understanding the problem - I can’t imagine anyone understanding the problems better than we did regarding small businesses access to growth capital. We spent an insane amount of time understanding what was happening in small business finance, what they needed, and why the problem existed.

• Surfacing and engaging small business owners - This was our greatest strength…our team knows how to market. Through our content and digital channels, we created a predictable funnel of small business owners opting to engage with us in a meaningful way. We did this mainly by becoming a marketplace of business grants and helping business owners filter through the grants. Additionally, we had helpful content, and our organic reach was impressive. It was amazing to have the one part of serving small businesses that is so hard for many other fintechs essentially be our strength. Riley gets all the credit here!