Another one bites the dust.
According to Fortune, they obtained a private message from CEO Jonty Kelt that stated that “there is no return for investors, as proceeds from the deal are only enough to cover $3.4 million in venture debt, along with a $2 million convertible bridge note provided by Spark and QED Capital.” The last round of funding was raised six months ago to “to keep the company alive in order to find a soft landing,” Kelt writes.
Onswipe offers a tablet publishing tool with built-in ads reminiscent of magazine ads, was considered a success story since they were Techstars NY in 2011. They raised $6 million in venture funding and in 2012 raised US$ 5.3 million.
Last year, the company hired Kelt as CEO and bumped co-founder Jason Baptiste to chief marketing officer, as they decided to rebuild its technology from scratch, but that effort took too long to build and “caused a domino effect,” Kelt wrote. “Revenues were lower than expected and burn higher than expected,” he explains. The company tried to raise new capital but came up short, raising the bridge note instead.