Banking-as-a-service startup Solid has officially filed for Chapter 11 bankruptcy protection. Marking a dramatic fall for a fintech once valued at $330 million. The filing was submitted on April 7 in the U.S. Bankruptcy Court for the District of Delaware.
Founded in 2018 and previously known as Wise. Solid had raised nearly $81 million from investors including FTV Capital and Headline. In August 2022, it secured a $63 million Series B led by FTV. Which helped push its valuation to over $300 million, according to PitchBook.
At its peak, Palo Alto-based Solid positioned itself as the “AWS of fintech,” offering integrated APIs for banking, payments, crypto, and card services. The startup focused on serving fintech platforms and vertical SaaS companies. Just two years ago, the company claimed 10x revenue growth. A customer base of over 100, and even stated it had reached profitability.
Now, that momentum has come to a halt.
According to the bankruptcy filings, Solid is pursuing a court-supervised restructuring or sale. “After considering all options, we’ve decided that a voluntary Chapter 11 restructuring is the best course,” said co-founder Arjun Thyagarajan “We’re optimistic that the court-supervised sale process will attract the right buyer, leading to a positive outcome for the company, customers, and shareholders.”
But behind the scenes, Solid has faced mounting legal and financial challenges. Since its last funding round, the startup struggled to raise fresh capital and became entangled in a costly legal battle with its lead investor, FTV Capital.
In 2023, FTV sued Solid, seeking to claw back $61 million of its investment. The firm accused co-founders Thyagarajan and Raghav Lal of misleading them about the company’s financial health. Including inflated revenue figures and downplayed customer churn. FTV even demanded the founders step down.
In response, Solid filed a countersuit, calling FTV an “aggressive private equity firm” that turned to “made-up claims of fraud, threats and strong-armed tactics” when its investment underperformed. However, court documents show that the lawsuit was dismissed with prejudice in April 2024, following a settlement between both parties.
Despite resolving the dispute, the damage was done. Solid now reports just $760,000 in unsecured trade debt, limited current revenue, and $7 million in cash—$2 million of which is locked in non-liquid reserve accounts. The company has also shrunk to a mere three employees.
Solid filed under Subchapter V of Chapter 11, a streamlined process aimed at helping small businesses restructure faster and more flexibly. It’s the same path taken by fellow BaaS startup Synapse, which filed for bankruptcy in 2023 after failing to sell its assets in a $9.7 million deal with TabaPay.
Interestingly, both Solid and Synapse shared a common thread: they were partnered with Evolve Bank & Trust. That same institution has come under scrutiny, prompting fintechs like Mercury to sever ties.
According to fintech industry commentator Jason Mikula and RK | Consultants, Solid’s bankruptcy filings reveal a list of major unsecured creditors. Among them are Amazon (AWS), FS Vector, Visa, Plaid, Trulioo, Spade, and several law firms.
With limited cash, unresolved debts, and an uncertain buyer pool, the road ahead for Solid remains steep. But in the ever-volatile world of fintech, it’s a reminder of how quickly even high-flying startups can fall.
