Cushion, a fintech startup that described itself because the “Plaid for purchase now, pay later (BNPL),” has shut down.
On Thursday, founder and CEO Paul Kesserwani posted on LinkedIn in regards to the determination to wind down the corporate on the finish of 2024.
Within the put up, Kesserwani mentioned that “regardless of bringing a number of new fintech merchandise to market,” Cushion “didn’t attain the size wanted to maintain the enterprise.”
Based in late 2016, San Francisco-based Cushion had raised a complete of $21.6 million from buyers reminiscent of Afore Capital, Flourish Ventures, Vesigo Ventures, Higher Tomorrow Ventures and 500 World.
Its final publicly-announced increase was in Could, 2022 when it closed a $12 million Collection A led by Afore Capital. Its post-money valuation in 2022 was $82.4 million, in accordance with PitchBook.
Kesserwani didn’t instantly reply to Fintech’s request for remark.
Cushion provided a shopper app that sucked within the transaction historical past from its customers’ financial institution accounts, decided what charges had been assessed after which performed negotiations on their behalf to get a refund. It was designed, Kesserwani advised Fintech in 2019, to be incentive-aligned with shoppers by solely taking a fee on any returned money.
Kesserwani received the thought for Cushion after leaving his job at Twitter. Whereas taking a while off to consider what he needed to do subsequent, he was serving to his dad and mom handle their financial institution accounts whereas they have been touring for work in Lebanon. Because of financial institution safety insurance policies, his dad and mom weren’t in a position to log into their accounts from Lebanon, and ultimately, they confronted a mountain of banking charges as their accounts went unattended. As Kesserwani investigated, he turned to his personal accounts, and realized he had additionally been paying charges to the tune of $400 that he had no reminiscence of agreeing to.
In Thursday’s LinkedIn put up, Kesserwani mentioned that Cushion had automated financial institution price negotiation and reached $3 million ARR in 10 months and processed over $300 million in BNPL loans. He added that the corporate had onboarded over 1 million shoppers over time, with over 200,000 paying prospects.
Wrote Kesserwani: “I gave Cushion the whole lot I had for 8+ years. Whereas the end result wasn’t what we hoped for, we constructed one thing that moved the trade ahead — and I’m pleased with that. As for me, I’m excited for what’s subsequent.”
Knowledge means that 2025 is predicted to be one other brutal yr for startup shutdowns. In late December, one other fintech – Bench – shut down abruptly solely to be acquired days later.
