The decision of US-based mobile search platform Quixey was largely in part due to its inability to repay a loan provided by a shareholder, e-commerce firm Alibaba, Axios reported yesterday.
Quixey has developed deep mobile search technology that can scour multiple platforms for information simultaneously. It had raised approximately $132m in funding since it launched in 2009 but revealed in a blog post late last month it was exploring strategic options for its future.
The company raised $20m in a 2012 series B round featuring telecommunications company SK Telecom’s SK Planet unit as well as US Venture Partners (USVP), WI Harper, TransLink Capital, Atlantic Bridge Capital and Innovation Endeavors.
Alibaba first invested as part of a $50m series C round the following year which it led, investing together with GGV Capital, Innovation Endeavors, TransLink, Atlantic Bridge, USVP and WI Harper.
The series C funding, raised at a $130m pre-money valuation, was sealed alongside a $100m commercial contract with Alibaba.
Quixey raised $60m in a 2015 series C-1 round that valued Quixey at $540m and which was also led by Alibaba and backed by telecommunications firm SoftBank, Goldman Sachs and GGV Capital.
The round took Alibaba’s total equity commitment in Quixey to $80m but by that point Alibaba had gone public meaning Quixey found itself interacting with different team members. It was reportedly encountering difficulties with its technology and believed it was owed $37m from the Alibaba contract.
The companies resolved the issue in August 2016 with a $10m payment from Alibaba together with $30m of debt financing. However, the debt came with an 18-month repayment date and a veto option for Alibaba with regard to any future equity funding.
Quixey began raising new capital in November and by February existing investors including Atlantic Bridge Capital had agreed to provide $10m, only for Alibaba to overrule the deal, meaning Quixey had to instigate layoffs and begin looking for a buyer.
Alibaba told Axios in a statement: “Unfortunately, the development of the company did not meet expectations and the board made a decision to end the business.”