A Difficult Goodbye: Reflecting on Vambora's Journey and Future

Hello friends, today I have a sad announcement to make:  our journey with Vambora is coming to an end due to financial challenges.

We have depleted our resources trying to innovate in our mission to create financial inclusion for immigrants and international students. In this article, I want to talk about what led us here and what’s next.

Why did we fail?

I have been publicly documenting the struggles we faced as an early-stage startup trying to innovate in the fintech space with limited resources. Although a huge challenge, it wasn’t the only problem:

• Regulatory uncertainty - we have seen some legislative progress lately, but we’re still far from having Open Banking fully implemented in Canada
• High adoption barriers - No regulations mean higher adoption barriers to our technology, and that’s why we first targeted SMBs as early adopters. We had strong data points in the property management space to demonstrate latent product-market fit in the hopes of raising our seed round
• Market pull without funding - When the Canadian government announced the introduction of Open Banking last year (Nov/2023), we were approached by large enterprise companies requesting an API offering

With a boost in confidence since the announcement, I decided to bet our last resources to cater to enterprise-level companies. We successfully built the infrastructure to enable B2B clients to access global banking and transaction data across more than 20 countries and 5,000 financial institutions. We also built a consent management system on a native mobile app (Android and iOS), enabling consumers to securely manage access to their Trust Profile when submitting a credit application for products and services.

We then built a pipeline of +$200k in potential sales in Q1, but that wasn’t enough to secure capital so we could obtain the security and privacy industry standards (SOC2 and GDPR), which was a prerequisite to unlock sales opportunities.

Innovation vs Regulation

I’ve always believed that the financial inclusion problem could be solved with data. While Open Banking holds great promise, its impact varies across countries based on the pace and effectiveness of implementation, regulatory frameworks, and industry adoption.

In Canada, due to lengthy regulatory processes involving multiple phases and ongoing consultations, we have been anticipating the implementation of Open Banking for the past six years. However, it is still uncertain whether the government will meet its latest deadline by the end of 2025.

While North America is still in the early stages of Open Banking adoption, several other regions have made significant strides, demonstrating the benefits that a robust open framework can bring.

For instance, with swift legislative actions and a clear regulatory framework, Brazil successfully implemented Open Banking in just two years (2019 - 2021), and in 2023 they have reached 22 million users. After implementing Open Banking, the Bank of Brazil increased credit limits for individuals by over R$700 million (approximately $140 million), and it is expected to drive financial inclusion, with an estimated 55 million unbanked or underbanked individuals gaining better access to financial services.

This is exactly what I envisioned for not only newcomers but for all Canadians. However, Vambora doesn’t have the resources to wait any longer.

What’s next for Vambora?

As for the next steps for Vambora, we are entering into a phase of liquidation. This process involves winding down our operations and settling our obligations. It is a complex process and certainly not one we entered into lightly, but it is a necessary step given our current financial situation.

Furthermore, we are actively in talks to sell our assets. This includes both our physical assets and our intellectual property. Our technology holds significant value, and we are hopeful that it can find a new home where it can continue to be used and developed.

Thank you to everyone who supported us along the way. Your belief in Vambora and in me means more than words can express and a special thanks to our investors. We wouldn’t have made it this far without you.

Thank you 💚