Tencent-backed Everledger is collapsing due to lack of funding

Everledger, a blockchain company from Australia, is said to have entered insolvency proceedings after it failed to secure new funding from an unnamed investor.

Failed to collect money

On May 8 reported the AFR that Everledger, a company that uses blockchain to trace the origin of diamonds and other goods, failed to complete its most recent round of funding.

As a result, Everledger was tacitly placed under voluntary administration as the company was unable to service its debts. All Everledger employees were dismissed on 31 March and Vincents Chartered Accountants were appointed as administrators on 24 April. The first meeting of creditors was scheduled for May 8.

Everledger founder Leanne Kemp stated that the company’s management was compelled to take this step to protect the interests of shareholders. “Everledger’s second tranche of funding has not materialized and we understand that there was external pressure on the investor, which put Everledger in a difficult and unexpected position,” said Kemp.

dismissal of staff

She added that one of the very important decisions was to fire the staff immediately and keep the company under the control of the trustees while the business is being taken care of.

Kemp went on to say that Everledger planned its final investment around the final round of outside financing needed to become profitable. “I wouldn’t suggest that Everledger was a money-burning startup,” she stated, adding:

Certainly, our capital utilization and operating footprint were fully consistent with the board’s direction under a controlled growth plan. This isn’t a company that scaled too quickly or raised venture capital and burned it in 18 months.

Striking: Big names are already investors

Despite backing from major investors, including the Australian government and Chinese internet giant Tencent, Everledger has had to go through insolvency proceedings. In 2019, Tencent led Everledger’s Series A funding round with a $20 million investment.

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Everledger has also secured $3.5 million from the UK government’s Future Fund in 2021, according to the AFR. Over the past eight years, the company reportedly raised $51.7 million in outside investment.

Founded in 2015, Everledger is one of the world’s largest companies pioneering blockchain-based platforms for supply chain tracking.

While some companies, including Danish logistics company Maersk and US technology company IBM, have discontinued their blockchain supply chain tracking products due to a lack of “global industry collaboration,” the concept of blockchain-based supply chain platforms remains flourish in some parts of the world. The Hong Kong-based Global Shipping Business Network continues to develop blockchain-based supply chain products and is optimistic about blockchain as a critical long-term logistics tool.

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