Less than two years after raising an $80 million Series D, automated debt manager Tally has shut down after not being able to raise more money in a tough environment for fintech startups.
Founder and CEO Jason Brown said in a LinkedIn post, “we have made the difficult and sad decision to shut down Tally. This was not the outcome we had hoped for, but after exploring all options, we were unable to secure the necessary funding to continue our operations.”
The San Francisco-based startup helped people manage and pay off their credit card debt.
In October 2022, Tally raised an $80 million Series D led by Sway Ventures at a $855 million post-money valuation. Other investors in the round included Andreessen Horowitz, Cowboy Ventures 1, Kleiner Perkins and Shasta Ventures.
Founded in 2015, the company has raised $172 million, according to Crunchbase data.
Financial services’ slow fade
Tally’s inability to secure new funding is not unusual given current market conditions.
Venture funding funding to private companies in financial services — a top sector for VC investment — has slowed significantly the past several quarters. In the second quarter of 2024, financial services companies raised $9.7 billion — per Crunchbase data — up a bit both year over year and quarter over quarter, but down an eye-popping 75% from the market peak of Q2 2021. That quarter more than $40 billion was invested.
Over the past five quarters, funding to financial services companies was below $10 billion each quarter, based on Crunchbase data. Those five quarters show the lowest funding amounts to the sector since Q1 2017.
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Illustration: Dom Guzman
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