Nuula CEO Mark Ruddock initially publicly spoke about the company’s failed Series A round in October, which he attributed to “a set of unforeseen circumstances.”
When Nuula’s Series A fell apart, the company’s board of directors decided that Nuula should initiate the process of selling its assets.
“This round has taken months to prepare,” Ruddock wrote at the time. He told BetaKit that Nuula was looking to raise $5 million, but it became impossible to close. “With no other choice, the board decided that we should initiate the process of selling the Nuula assets. Furthermore, we had limited cash on hand, and when it became clear that we could not unlock adequate bridge financing to support operating the company for more than a few weeks, we arrived at the difficult decision to release the team at the end of September.”
According to Ruddock, Nuula had about 30 people in Canada as of September 2022; all were let go by the end of the month.
Nuula was formerly named “BFS Capital,” and operated for two decades offering small business loans. The company began its transformation into a data and analytics app in 2019, when it opened an engineering hub in Toronto. In 2021, it announced $120 million USD in secured funding, which comprises a $100 million loan book facility, $10 million in conversion of legacy debt, and $10 million in equity. In that year, Nuula also rebranded and moved its headquarters from the US to Toronto.
Nuula launched its rebranded offering to the US in 2021, focusing on delivering business insights and financial products to small business owners. It then launched in Canada in 2022 in partnership with fellow Canadian startups Caary and OneVest.
Nav told BetaKit that its acquisition of Nuula will help the former continue to “build the best experience for small business owners.”
“We were impressed by Nuula’s approach to solving data and integration challenges while solving for an engaging mobile experience for small business owners,” Nav’s spokesperson said.
Ruddock wrote in a new statement on Thursday that “the vast majority” of Nuula’s technology team, in addition to its core data science, accounting, and marketing talent from its Canadian office, rejoined Nav at the acquisition close in December. The group comprises over 20 former Nuula employees.
“The Nuula technology will become an integral part of Nav’s mobile offering going forward, and the team is already working hard to help deliver on that promise,” Ruddock said.
Speaking to Nuula’s Series A round falling through in 2022, Ruddock wrote: “To my CEO peers facing tough economic and/or funding climates … Never give up. Never surrender.”
In a separate statement to BetaKit, Ruddock said: “I believe in being transparent as a leader. That means being courageous enough to admit when things don’t go the way you had intended. We learn from these sorts of hardships, whether they happen to us or to our peers, and I wanted to share the experience as a cautionary tale.”
Including Nuula, this difficult fundraising climate has been felt by a number of Canadian tech startups. Some of these events have been related to capital calls not being honoured by limited partners, thus putting the squeeze on some Canadian venture capitalists.
Causing a domino effect, the immediate harm is to Canadian startups that are looking to fundraise, including those that had closed rounds, only to never see the funds materialize.
Ruddock is no longer the CEO of Nuula, and will not be joining Nav. He has previously served as CEO in multiple tech companies across Canada and beyond, including app developer Viigo, which was acquired by Research in Motion in 2010.
Featured image courtesy Nuula.