Sigfox, the France-headquartered internet-of-things (IoT) technology provider which has raised over $300m from an investor base including some 10 corporates, has filed for bankruptcy protection, TechCrunch reported yesterday.
Founded in 2010, Sigfox is the creator of an end-to-end connectivity system for IoT devices, enabling them to communicate with each other without using significant quantities of power.
The company said in a statement to TechCrunch the decision had been spurred by slow product sales fuelled by the covid-19 lockdowns and exacerbated by a worldwide shortage of crucial electronics components.
The bankruptcy process is expected to last for six months as Sigfox searches for an entity which can acquire it and safeguard jobs.
Although the coronavirus pandemic and the resulting lockdowns proved helpful for many digital-facing companies, some have slipped into trouble.
Construction services provider Katerra closed its doors in June 2021, five months after internet and telecommunications group SoftBank provided $200m to stave off bankruptcy proceedings.
Two more SoftBank portfolio companies, satellite internet system developer OneWeb and online grocery and home product retailer Brandless, had closed their doors at the start of the pandemic, as the prospects for fundraising appeared slim.
Other high-profile cases of VC-backed companies closing in recent months include balloon-based internet system developer Loon and shared workspace provider Knotel, which found itself unable to capitalise on rival WeWork’s difficulties.
The common thread between these companies seems to have been their relatively nascent offerings, indicating that while certain business models have been turbocharged by the pandemic, developers of more individualised or pre-revenue products have found themselves high and dry.
While in one sense these developments were arguably inevitable – innovative technology developers are always in a race between cash on hand and revenue – they also show the direction of funding to sectors such as digital health and fintech may have made it trickier for startups in other areas.
Sigfox last raised money in 2017 when it received an undisclosed amount from Malaysian sovereign wealth fund Khazanah Nasional.
Salesforce Ventures, Aliad and Intel Capital had taken part in a $160m series E round for the company the previous year on behalf of enterprise software producer Salesforce, industrial gases provider Air Liquide and chipmaker Intel, as did conglomerate Tamer and oil and gas supplier Total.
The round was filled out by Alto Invest, Swen Capital Partners, Idinvest Partners, IXO Private Equity, Elliott Capital Management, BPIfrance and Henri Seydoux at a reported $637m valuation, and it took Sigfox’s total funding to roughly $310m.
Air Liquide and Elliott Capital had joined energy utility Engie, satellite services provider Eutelsat and telecoms operators SK Telecom, Telefónica and NTT Docomo in a $115m series D round in 2015 valuing Sigfox at $400m. Elaia Partners and Partech Ventures were among its earlier investors.
Image courtesy of Sigfox.
