Tally, a credit card debt management platform, has closed its doors due to a lack of funds to run its operations, founder and CEO Jason Brown said in a LinkedIn post Monday.
The nine-year-old fintech decided to shut down after considering all alternatives, underscoring the current difficulties facing financial technology companies.
“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,” Brown wrote without clarifying when the company notified its staff and customers about its decision.
According to the company, Tally’s automated debt manager is the first of its kind, letting users link their various credit cards and paying them off on their behalf. It is built to save consumers hundreds of dollars in interest fees every year.
Founded in 2015, Tally has helped consumers pay down more than $2 billion in debt, the fintech noted.
“Tally was designed to be more than just a tool; it was a financial coach working quietly in the background, automating payments and guiding users toward healthier financial habits,” Brown said.
This is the second fintech to cease operations this month. Totem, a Native American-focused fintech, shut down earlier in August. Amber Buker, Totem’s founder and CEO, announced the news on LinkedIn, noting investors wanted to see more progress in less time.
Tally showed signs of trouble when it sunsetted its direct-to-consumer loan portfolio in April and offered its line of credit through its partner network. It encouraged the credit line users to access its white-labeled business-to-business credit card debt management software through one of its partners, though users could also continue to use Tally’s suite of products directly within the application.
The product was slated to be launched in July 2024 by Tally’s first partner, a large publicly traded consumer company with over 50 million users, the company said. Tally raised additional capital from its existing investors to develop the B2B product.
“We started the company going straight to the people who needed it most,” Brown said in a statement in April. “But what we’ve discovered — and as market dynamics have gotten even more challenging — is that our overall impact can be much greater if we enable partners to leverage our technology.”
The company is backed by Kleiner Perkins, Andreessen Horowitz, Shasta Ventures, Sway and Cowboy Ventures and has raised over $200 million to build and scale its platform, the company said in April.
Tally's most recent valuation was at $855 million with a workforce of 183 employees, according to PitchBook data.
Global fintech funding peaked in 2021 with over $210 billion — the second highest annual total ever, according to KPMG. Fintechs like Block, Klarna, Affirm and Revolut had reached historic multi-billion valuations. However, investment in fintech saw a decline, with 2023 showcasing $113.7 billion in funding, hitting a five-year low, the professional services company reported.
In a recent report by Innovate Finance, total capital invested in fintech globally in the first half of 2024 reached $15.9 billion — a 19% decrease from H2 2023.
The lines of credit offered by Tally were issued by Cross River Bank, which last year was ordered to clean up “unsafe and unsound” lending practices by the Federal Deposit Insurance Corp. The Fort Lee, New Jersey-based bank recently appointed three new board members to boost its growth.
Tally and Cross River Bank did not respond to a request for comment by Banking Dive within press time.
Before launching Tally, Brown founded Gen110, a consumer debt product that financed solar installations, and Bask, a remote technology support platform for consumers and small businesses globally.
“While this is the end for Tally, our expectation is that it is not the end of our mission. The need for financial tools that truly help people is as critical as ever. I hope that what we started with Tally will inspire others and influence new ideas and approaches to managing debt,” Brown wrote. “As we close this chapter, I look forward to seeing what the future holds for each of us.”
