Carrot Rewards shuts down app, files for bankruptcy

carrot rewards

Carrot Insights has announced that is has shut down its public wellness and rewards app, Carrot Rewards, as of Wednesday morning.

The company made the announcement Wednesday afternoon, stating, “it breaks our hearts to be saying farewell to you as we have closed down the Carrot Rewards app.”

“Just like so many other young startup ventures, our beautiful Carrot needed investment funding to keep running and, even though we gave it our all, our funds eventually ran out and we could no longer be in business,” Andreas Souvaliotis founder and CEO of Carrot Rewards said in the statement.

Founded in 2016, Carrot Rewards was an AI-powered platform that leveraged behavioural economics and nudge theory with the goal of helping Canadians “make better everyday lifestyle choices.” In November the company announced that it had reached one million users.

The Ontario provincial government gave the company $1.5 million in 2017 to help scale its platform. Carrot received at least $7.5 million in funding from the federal and B.C. governments in 2017 and has also received funding from Relay Ventures, Lumira Ventures, and EdgeStone Capital Partners.

Following initial excitement from investors Carrot Rewards slowly lost their interest, according to The Globe and Mail, which reported that the company is filing for bankruptcy in order to be able to pay off its suppliers that it owes money for points to, including Cineplex’s Scene program.

Carrot was apparently in the market for a buyer prior to today’s announcement. Souvaliotis told The Globe and Mail that Carrot brought on Ernst & Young three months ago to oversee the sale of the company, but the offer reportedly did not attract any interest. Souvaliotis added that the government’s “slowness to innovate” impeded the app’s ability to grow, leaving it with no option but to shut down.

The app itself looked to encourage healthy behaviours by rewarding users with points and rewards. The app was co-created through a multi-sector partnership with charities including the Heart & Stroke Foundation, Diabetes Canada, and YMCA, and select loyalty partners SCENE, Aeroplan, Petro Points, Drop, and More Rewards.

Carrot has partnered with RBC Rewards, as well as Cineplex’s Scene points, Aeroplan Miles, and Petro Points as rewards that users could earn through the Carrot Rewards app by walking and moving around. RBC previously stated that the Carrot Rewards partnership was part of a larger commitment of over $15 million to health and wellness programs across Canada.

BetaKit has reached out to Carrot Rewards for comment.

With files from Isabelle Kirkwood

Feature image courtesy Mobile Syrup

Meagan Simpson

Meagan Simpson

Meagan is the Associate Editor for BetaKit. A tech writer that is super proud to showcase the Canadian tech scene. Background in almost every type of journalism from sports to politics. Podcast and Harry Potter nerd, photographer and crazy cat lady.