Close, But Not Unicorn 🔥

What Tally's collapse tells us about Fintech's fragility...                                                                                                                                                                                                                                                                                                                                                                                                                 [Listen Online]( | [Read Online]( Close, But Not Unicorn What Tally's collapse tells us about Fintech's fragility... [Nicolás Cerdeira]( [like]( [fb]( [fb]( [fb]( [fb](mailto:?subject=Post%20from%20Failory&body=Close%2C%20But%20Not%20Unicorn%3A%20What%20Tally%27s%20collapse%20tells%20us%20about%20Fintech%27s%20fragility...%0A%0Ahttps%3A%2F%2Fnewsletter.failory.com%2Fp%2Fclose-not-unicorn) In partnership with Hey — It’s Nico. This is the last email I’m writing from Buenos Aires for a few months as… I’m moving to SF tonight! 🛫🌁🥳 [As I shared in the past](, I’m moving to join a startup called [daydream](, as it’s first Growth hire. I have almost 0 friends in the Bay. So if you’re around the area, please reply to this email and I’ll invite you a coffee! Failory will continue to be just as it is. But you can expect more personal content and SF-related stuff in the newsletter in the following weeks 😉. That’s all about me. This is what I’m sharing in this week’s issue: - Tally, a SF fintech (almost) unicorn has shut down. — read why below. - Forbes releases the "[Next Billion-Dollar Startups 2024](" list. - Startup failure rates [surge by 60%]( in 2024. - [4 SaaS ideas and growth strategies]( by Greg Isenberg. - Suno, an AI music generator, is the fastest growing AI product right now. It is actually really good. — read more below. Let’s get into it. How OpusClip went from 0 to 6 figures in affiliate revenue. OpusClip, an AI-powered video repurposing tool, quickly realized the power of affiliate marketing in the content creation industry. In just a few months, their program has hundreds of active affiliates, contributing over $100K in sales! OpusClip credits [Rewardful]( as a crucial partner in achieving this rapid revenue growth. With Rewardful as their affiliate software, the team has been able to focus on expanding the business while maintaining a high-performing affiliate program. [Read the full story.]( This Week In Startups 🔗 Resources Forbes releases the "[Next Billion-Dollar Startups 2024](" list. Greg Isenberg shares [4 SaaS ideas and growth strategies](. A deep dive on [YC-backed fitness startup Eight Sleep](. Why founders should [build in vertical markets](. Reclaim.ai’s CEO on [how to approach founder-led content](. A 2024 guide to [B2B product-led sales](. 📰 News Startup failure rates [surge by 60%]( in 2024 according to Carta. AI startups' funding rounds are[pushing seed VCs to the sidelines](. [Early-stage startups face]( the longest funding gaps in a decade. [Radical Ventures raises]( nearly $800M to invest in AI startups. [Linktree acquires]( social media scheduling tool Plann. 💸 Fundraising Fintech startup [Bolt looking to raise $450M]( at a $14B valuation. [BeyondMath raises $8M]( to improve engineering and design with AI using physics. [YC-backed Waza raises $8M]( to support global trade for African businesses. Oslo-based [SportAI secures €1.6M]( to use computer vision for sports coaching. Fail(St)ory Almost Unicorn A few days ago, [Tally](, a once-promising Fintech startup from San Francisco, announced it was shutting down. Founded in 2015, Tally captured the attention of elite Silicon Valley investors like Andreessen Horowitz, eventually achieving a valuation of $855M. Despite raising $172M in funding, the company has now shuttered its operations, marking the end of a journey that began with high hopes and a mission to help consumers achieve financial freedom. What Was It: Tally aimed to be more than just another Fintech app; it was designed as a financial coach in your pocket. The app was built to automate payments and guide users toward healthier financial habits, ultimately helping them break free from the cycle of credit card debt. Tally offered a user-friendly dashboard that tracked credit card balances and, in some cases, provided credit lines to pay off those balances directly. The goal was to simplify debt management, making it easier for users to stay on top of their finances without getting overwhelmed by the complexity of multiple credit cards and payment schedules. The company’s innovative approach initially gained traction, drawing in a significant user base and praise for its potential to disrupt the traditional credit card industry. However, despite its early successes and substantial backing, Tally's journey took an unexpected turn. The Numbers: - 📅 Founded: 2015 - 💰 Total Funding: $172 million - 💵 Peak Valuation: $855 million - 📈 Business Shift: Pivoted from direct-to-consumer to B2B in April - 🛑 Closure: Less than six months after the pivot Reasons For Failure: - Funding Challenges: According to Jason Brown, Tally’s founder and CEO, the company [struggled to secure the necessary funding]( to continue operations. Despite the initial investment, the financial environment proved too challenging, particularly for a company in the Fintech space that relied heavily on continuous capital inflows to sustain growth. - Unsuccessful Pivot: In April, Tally announced a shift from its direct-to-consumer model [to a business-focused offering](. The pivot was intended to open new revenue streams by targeting other businesses rather than individual consumers. However, this strategic move failed to gain traction in time, leading to the company's eventual shutdown. - Customer Complaints: Tally also faced a significant wave of customer dissatisfaction in its final months. Numerous complaints were lodged with the [Better Business Bureau](, with customers reporting that Tally had stopped making promised payments to their credit cards and had raised interest rates on its credit lines. These issues likely eroded trust and contributed to the company's decline. - Market Pressure: The broader Fintech market has been under increasing pressure, with more companies opting to sell themselves to established banks rather than continue as independent entities. This trend reflects the difficulties Fintechs face in sustaining long-term growth and competing with larger, more established financial institutions. Tally’s struggle to secure funding and its pivot to B2B can be seen as part of this larger pattern. Why It Matters: - Pivots Are Risky: Changing business strategies can be a double-edged sword, as seen in Tally’s unsuccessful shift to a B2B model. - Customer Trust is Key: The wave of customer complaints Tally faced serves as a reminder that maintaining trust is essential for survival, especially in an industry like banking or Fintech. - Fintech Market Challenges: The increasing trend of Fintechs selling to banks suggests that staying independent is becoming more difficult in the current market. Trend AI Music [Suno](, the AI music generator, has become the fastest-growing AI product in the world, outpacing even giants like Claude and Perplexity. [tw profile: Nick St. Pierre] Nick St. Pierre @nickfloats [tw] Suno is the fastest growing AI product in the world right now based on @tryramp card transaction data More than Claude More than perplexity Music is unstoppable 12:56 PM • Aug 14, 2024 244 Likes 12 Retweets 24 Replies Why It Matters: - Suno is the most realistic and advanced AI music generator available. It can generate everything from lyrics to vocals and instrumentation, all from a simple text prompt. It doesn´t just create short samples; it can create full four-minute songs. - It empowers users of all skill levels to create professional-quality music, making creativity more accessible than ever. - With over 12 million users and significant investment, Suno is quickly becoming a dominant force in the AI music industry. - Suno is facing major copyright lawsuits, which could set a precedent for the entire AI-generated content industry. - The outcome of these legal battles will shape how AI and creativity coexist, potentially transforming the music landscape. Is It Actually Good? Yeah, I know how it sounds. AI-generated music just seems like an awful idea. But what you can accomplish with Suno is actually pretty impressive. Just listen to what it made when I asked it to create a love song about Sam Bankman-Fried. Love and Fraud by @melodramaticwav245 | Suno synth-heavy pop electronic song. Listen and make your own with Suno. suno.com/song/c1474251-ce8e-4f8e-af7f-7835b4bae10e This song genuinely blew me away. Sure, it's not going to win a Grammy anytime soon, but it surpasses anything we've been able to do with other AI music generators so far. And it's not just silly love songs about fraudsters; people are creating genuinely remarkable pieces. What impresses me most is its ability to handle any genre, voice, and style. Take a listen to this weird mix of flamenco, jazz and rock: Egyptian Dance Party by @decibelcortex | Suno jazz and trap slap guitar experimental flamenco math rock with layered harmonics song. Listen and make your own with Suno. suno.com/song/19807561-1427-4c25-a229-a8c3063d0616 And If you're like me and have already listened to every lo-fi track on Spotify a thousand times, you'll be happy to know that Suno is also pretty good at creating lo-fi music. Rapid Growth: Suno’s growth has been nothing short of remarkable. With over 12M users and a recent $125M funding round at a valuation of $500M, the company has rapidly established itself as a leader in AI-generated music. Suno’s rise to fame was significantly boosted by its partnership with Microsoft in December 2023, where it became part of the Copilot plugin ecosystem. This integration has given Suno exposure to a vast user base, further accelerating its growth. Legal Challenges: However, Suno’s journey hasn’t been without controversy. The company is currently facing a [copyright infringement lawsuit]( from major music labels, including Sony Music, Universal Music, and Warner Music. These companies allege that Suno used copyrighted songs without permission to train its AI, a claim that could have significant implications for the future of AI-generated content. The core of the lawsuit revolves around whether using copyrighted materials to train AI models falls under the “fair use” doctrine. While some other AI companies, including Anthropic and Google, argue that it does, the music industry contends that AI-generated music directly competes with the original copyrighted material, making fair use inapplicable. The outcome of this legal battle could set a precedent for the entire AI-generated music industry. So, what do you think about Suno? Is There a Future for AI-Generated Music? [❌ Art that is not made by humans is meaningless...]( [✅ My upcoming opera-rap-reggae mashup is going to blow your mind!]( Help Me Improve Failory How Was Today's Newsletter? If this issue was a startup, how would you rate it? [🚀 Launches to the moon!]( [🤔 Room for a pivot]( [💀 Crashes and burns]( That's all of this edition. Cheers, Nico Update your [email preferences]( or unsubscribe [here]( © 2024 Failory 1309 Coffeen Avenue Ste 1200, Sheridan, Wyoming 82801, United States of America [[beehiiv logo]Powered by beehiiv]( [Terms of Service](