Nudge.ai, the Toronto-based startup that developed a revenue intelligence platform using artificial intelligence, announced to its users on Monday that the company is shutting down.
In a letter to sent to customers and obtained by BetaKit, Nudge co-founders Paul Teshima and Steven Woods explained “the Nudge service is going away,” stating that “we were not able to turn Nudge into the success we had hoped.”
“We were not able to turn Nudge into the success we had hoped.”
– Paul Teshima and Steven Woods
Speaking to BetaKit, Teshima attributed the decision to shutter the business to a “combination of things” that led to “a challenging next raise and next option” for Nudge.ai. “We did everything we could and we just were not in a spot where we could continue to grow the business,” he stated.
Nudge.ai was founded in 2014 by Teshima and Woods, former executives of software startup Eloqua, which was acquired by Oracle in 2012 for $957 million. Through Nudge.ai, the two founders (CEO and CTO, respectively) developed a customer relationship management (CRM) platform that combined the most complete account-level dataset with AI to identify gaps in stakeholder relationships. The goal was to find and increase pipeline attrition.
The startup aimed to use AI to integrate a salesperson’s communications platforms, including email, calendar, and phone, as well as monitor relationships. The company had a free offering with 50,000 users on the platform in 2017, the same year it launched a business offering. More recently Nudge.ai offered free, pro, and business levels of its platform.
Nudge.ai had raised around $10 million CAD overall including pre-seed and a $6.5 million seed round raised in 2016. That seed round was led by OMERS Ventures, with participation from personal investors Jill Rowley, a previous investor in Eloqua, Neal Dempsey of Bay Partners, and Brad Woloson, former general partner at JMI Equity.
Teshima told BetaKit that the startup had been looking to raise additional funding over the past year and was in talks with venture capitalists over the summer and fall. He added that Nudge.ai had been looking for financing options, even outside of venture capital, up until last week but “nothing panned out.”
Nudge.ai thanked its investors in the letter, stating, “it was not the outcome we were all striving for, and yet, at every turn, you’ve each been tremendously supportive with your advice, encouragement, and patience.”
“It was just the right time to properly exit the business and make sure we can take care of our employees with some severance and also make sure we can pay all our bills,” Teshima stated
“While we can’t say we are ‘celebrating’ failure today, we are thankful that the journey was possible.”
In the letter that also thanked customers and employees for making Nudge.ai possible, the co-founders stated, “we pushed hard, we built interesting things, we wrestled with tough decisions, we fought for victories and overcame setbacks. Ultimately, we didn’t make it, but we had the opportunity to try, and for that we are deeply thankful.”
The free Nudge.ai app will remain available in a “limited state” until January 30 to allow users to download from their accounts. The pro and business applications will be made available until January 31 in limited states as well.
Nudge.ai noted that for pro customers, payments that would have gone beyond January 31 have been refunded and any future payment processing has already been shut down. The startup added that for business plan customers, Nudge.ai’s customer success manager would be reaching out to coordinate any refunds or billings that need to be coordinated “for final wrap-up.”
“To our customers, thank you for taking the chance on us,” the company wrote. “Early-stage innovation is never perfect, and always a bit rough around the edges. You are truly the unsung heroes of the innovation economy because without your willingness to take a chance on an unproven innovation, none of us would be able to get our innovations off the ground.”
The letter ended by highlighting Nudge.ai’s employees, calling on any companies or leaders in the space looking to hire to reach out. Teshima reiterated that sentiment, focusing on the desire to help Nudge.ai’s employees find employment. The CEO added that he and Woods, who have been working together for almost 20 years, plan to take time off and reflect.
“While we can’t say we are ‘celebrating’ failure today, we are thankful that the journey was possible,” Teshima and Woods stated. “Although the failure itself is sad, it’s only because it is the end of a journey that was so challenging and rewarding….we didn’t reach that goal, but because of everyone around us, we did have a chance to try. And that – that chance to try – is worth celebrating.”