Key banking brand filed unexpected Chapter 11 bankruptcy

The company was once an industry darling, and now it's trying to find a buyer to keep it afloat.

Apr 29, 2025 - 14:36

Any time a brand gets branded (or brands itself) as the something of some other industry it takes a major risk.

Calling yourself the Apple of the motorcycle industry or the Google of fishing, can simply be confusing. Using this type of designation helps company’s raise money as it makes their business easy to understand.

The problem is that this type of elevator pitch designation creates expectations. It’s a lot to be the Chipotle or Mediterranean food or the Netflix of live concerts.

in both cases, the shortcut description makes it easy to understand what the company wants to be. It also sets the actual brand for failure.

Chipotle and Netflix have easy to understand business models which have failed hundreds of times when used by other companies. It turns out that serving via a line of already-prepared foods and delivering video via streaming are only part of the magic for those two companies.

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Framing a business by comparing it to an unquestioned industry leader makes raising money and researching customers easier. But, if you do that and don’t deliver, failure can come quickly.

Solid provides services for banks.
Shutterstock

The AWS of fintech hits a roadblock

Solid, which used to be known as Wise, called itself the “AWS of fintech.” That’s a lot to live up to and a bit confusing as many people who use Amazon Web Services only vaguely understand what it does.

A banking as a service (BaaS) company, Solid uses a more modest description of what it offers on its website.

"Solid's platform enables banks and companies to offer embedded banking, payments, and card products, in a safe, secure and compliant way," it posted.

Basically, Solid offers white label banking products.

"With a single integration, build out your FinTech program on Solid, the most advanced and well-documented platform that helps you launch on budget, on time, on quality, and, most importantly, in full compliance," it added.

That's a potentially huge category and the brand was much-heralded during its most recent fundraising round.

More bankruptcies:

The company, which was founded in 2018, raised over $80 million. Solid was valued at $330 million as of August 2022, according to PitchBook, when it announced a $63 million Series B round of funding led by FTV.

Now, the company is fighting for survival as it has filed for Chapter 11 bankruptcy protection.

Solid files for Chapter 11 bankruptcy protection

Solid formally filed for Chapter 11 bankruptcy protection in the United States Bankruptcy Court for the District of Delaware on April 7. The filing made it clear that if its first-day motions were not approved, the company might not be able to continue operations.

It also shared the three aspects of Solid's BaaS revenue model:

Bank Partnerships: The debtor partners with regulated banks through Banking Services Agreements. These banks maintain custody of customer deposits,manage and execute money transmission, issue cards, and provide the underlying payments and compliance infrastructure required to operate compliant financial products.
Technology Platform for Fintech Clients: The debtor offers a developer-friendly application programming interface (“API”) platform (the “Solid Platform”) that allows fintech companies to quickly launch and scale financial products. The debtor’s offerings include connectivity between fintech clients and sponsor banks to open accounts, issue cards and initiate payment wrapped around compliance management and fraud monitoring.
Client Onboarding and Integration: The debtor signs up clients,usually fintech companies or platforms, that want to embed financial services. The debtor's clients then use the Debtor’s API and dashboards to launch financial products.

Solid has served 142 clients and worked with four banks. At the time of the filing, the company was owed $760,000 by clients and had $7 million in cash, only $5 million of which is liquid.

As part of the Chapter 11 bankruptcy filing it plans to wind down or sell its business. As it pursues a sale, it will continue operating normally.

The company, according to the Chapter 11 filing, faces "significant and costly litigation.”

The company is being sued by its own Series B investor FTV Capital which is seeking to get its $61 million investment back.