Lack of funding forces US credit card fintech Ness to close down
Ness, a US-based fintech building a suite of credit cards to reduce the cost of wellcare, has announced that it is shutting down.
A notice posted to its website this week by CEO and founder Derek Flanzraich reveals that the venture-backed start-up has run out of cash.
The fintech previously raised $15.5 million in a seed funding round led by Will Ventures in May 2022, and Flanzraich says that despite anticipating another fund raise, “ultimately we’ve run out of time”.
The round also drew participation from Core Innovation Capital, Accomplice, Digitalis, GFC, Portage Ventures, Refactor Capital, RiverPark and Atypical.
Founded in May 2021, Ness’ offering orientated around providing credit cards linked to rewards programmes, medical benefits and health insurance, incentivising what it describes as “healthy spending” with benefits from its brand partners.
In a corresponding post on LinkedIn regarding the closure, Flanzraich says the fintech had hoped to raise an additional $40 million, but ultimately recognised that “the market changed” and “the $40 million never came”.
“Despite our best efforts over the past year to re-envision the business – changing how we work, what we do, and cutting costs (and people, most painfully) – plus pitching a zillion investors, it’s hard not to feel like we were trapped,” Flanzraich’s LinkedIn post reads.
“And how different we’d do things if we knew then what we now.”
The post indicates that Flanzraich will now attempt to sell what remains on the company to hopeful entrepreneurs, and suggests that he will attempt to join another existing firm over founding another company again.