The Australian blockchain company Everledger finds itself in financial trouble after failing to secure new funding from an undisclosed investor. Everledger, known for its focus on tracking the provenance of diamonds and other goods through blockchain technology, couldn’t successfully complete its latest funding round.
Subsequently, Everledger was placed into voluntary administration as it became unable to pay its debts. All its employees were given layoff notices on March 31, followed by the appointment of Vincents Chartered Accountants as administrators on April 24. The first meeting of creditors occurred on May 8.
Founder Leanne Kemp claims that the decision was made to protect the interests of shareholders. She stated that external reasons and pressures on the investor left Everledger in an unexpected and difficult position. As a result, the firm finds itself in the hands of administrators while they finalize its affairs.
The latest investment round was supposed to be Everledger’s last external funding round before reaching profitability. Kemp argues that her company wasn’t a “cash-burning” startup, noting that its capital use and operational footprint aligned with the board’s direction under a controlled growth plan.
Despite being backed by major investors such as the federal government and Chinese internet giant Tencent, Everledger’s insolvency persists. Tencent led Everledger’s Series A round with a $20 million investment in 2019. Additionally, Everledger secured $3.5 million from the United Kingdom Government’s Future Fund in 2021. Over the past eight years, Everledger managed to raise $51.7 million in external investment.
Founded in 2015, Everledger is one of the pioneering companies in the world when it comes to creating blockchain-based platforms for tracking supply chains. However, some firms like Danish logistics company Maersk and United States technology company IBM have already terminated their blockchain supply chain tracking products due to a lack of global industry collaboration.
Despite these closures, the concept of blockchain-based supply chain platforms is still very much alive. For instance, Hong Kong-based Global Shipping Business Network continues to develop such products while remaining optimistic about blockchain as an essential logistics tool in the long run.
While Everledger’s situation is undoubtedly worrisome for its stakeholders, it is crucial to remember that this does not necessarily spell the end of blockchain technology in supply chain tracking. The industry must adapt and learn from these experiences to ensure future success in implementing blockchain solutions for logistics management.
Source: Cointelegraph
