Catch co-founder Kristen Anderson tweeted On Monday, the company she and co-founder Andrew Ambrosino started six years ago will close.
Anderson and Ambrosino created Catch, and as she explained in a Twitter thread and post on the company’s website“with the crazy idea that our benefits shouldn’t be tied to traditional work and a W2 form.”
“We were bold enough to believe that a trillion-dollar ecosystem built by corporations, government and our financial institutions over the past 75 years could be toppled by a startup that turns everything upside down,” Anderson wrote. “Today? We still believe that. We just have to admit that we are not the ones doing it now. We made the difficult decision to close Catch.”
In the tweet, Anderson spoke individually to Catch’s customers, investors, team, friends, and those she labeled as “less-than-friends” about their support as Catch scaled its app to provide payroll and benefits to the self-employed.
Anderson previously spoke to me in 2021 when Catch raised $12 million in Series A funding. The round was led by Crosslink and included existing – and may I add high-profile – investors, including Khosla Ventures, NYCA Partners, Kindred Ventures and Urban Innovation Fund. In total, the company has raised $18.1 million in venture-backed funding since its inception in 2019.
While it took the Catch team of 15 (in 2021) almost two years to get approval to sell its platform in the federal marketplace in 38 states, the company ultimately had insurance licenses with 47 states and the District of Columbia, according to its website.
After getting those insurance approvals, Catch became one of only eight companies at the time to reach that milestone, in addition to becoming one of three approved to sell benefits to consumers, Anderson said.
Anderson, whose Twitter profile now reads “failed fintech founder,” received an outpouring of support for her tweet. Anderson did not respond to a request for comment.
Anderson doesn’t specifically mention why the company decided to close the tweet, but in an email sent to Catch users and obtained by ukbusinessupdates.com, Anderson and Ambrosino write, “unfortunately, we can’t continue to operate in the current market …” and that all Catch accounts would be closed on April 6.
While talking about the Series A in the 2021, Anderson said he would eventually go after a Series B round. Over the past year, however, the fundraising environment has become more restrictive, especially for underwriting companies. As several of my colleagues have pointed out in recent stories, investment in the insurtech sector fell to its “lowest level since Q1 2020” in Q4 2022, while insurtech took the lead in exiting mergers in 2021 and acquisitions.
“Our only hope of building a strong and successful middle class is to make it easy for a new type of worker to build assets and protect their families,” Anderson wrote in her tweet. “More iterations of these ideas will follow, and we hope our work and learnings have moved them forward.”
