Running a start up is one of the riskiest jobs an entrepreneur can take on in their career. This is particularly evident when companies head to social media or social funding websites in order to raise the capital needed in order to bring their concepts to life. The reason companies need to go to these platforms to begin with is simple — they can’t secure finances for their concept in more traditional methods and sometimes for obvious reasons. Looking through 2017 at failed start ups can be a lesson in agony, but no agony is worse than seeing how close the following companies got to making it before failing.
Starting off the list of most highly funded start ups to fail is the company Beepi. With 35 investors in the book through five rounds of investments, Beepi managed to raise $148 million for their concept. Beepi was aiming to be the next platform that people relied upon to buy and sell used vehicles. Despite strong customer support and an innovative idea, Beepi would fail in February. The reason? Company executives had no idea how to manage their money and the company was burning nearly $7 million per month.
Next up on the list is Auctionata, a start up that planned to live stream auctions around the world. The concept was innovative enough to pull in 15 investors and nearly $96 million in total funding. The reason for this company’s failure was as technical as it was financial, broadband speeds were too intermittent for reliability and live auctions need to be precise. The company would fold itself and merge with Paddle8, a similar platform that had launched way back in 2011.
Quixey followed suit by raising $165 million through four rounds of investing. Their valuation peak hit nearly $600 million. The goal of the Quixey application was to create a digital assistant for users to utilize at home. Unfortunately Quixey wasn’t able to nail their concept nor were they able to bring in enough funding to stay afloat while trying to figure things out. The company folded in May.
Finally we’ll take a look at the start up Yik Yak. Priding itself as one of the first truly anonymous mobile social networks, Yik Yak managed to raise $73 million from nine different investors. However, the application had problems from the get-go. Bullies and trolls flooded the network, real users began to leave, and soon nobody was even using the application. They shut down in May.