The impact of the Covid-19 pandemic on the tech industry is still being felt, with one of the latest developments coming out from France. Sigfox, a high-profile Internet of Things startup that raised over $300 million in venture funding and had ambitions to build a global communications network using a new approach to wireless networking, has filed for bankruptcy protection in France.
It will use the process to seek a buyer to support Sigfox's long-term development and propose to maintain jobs.
The company provided a statement about the bankruptcy. Business was being impacted by a shortage of electronic components.
The decision to place Sigfox under the protection of the Justice was made because of a slower-than- expected adoption cycle for its technology. These factors combined have made it difficult to speed up the development of Sigfox and its worldwide recognized technology in an increasingly competitive market.
Sigfox had raised over $300 million from a group of high profile investors that includedSalesforce, Intel, SAMSUNG, NTT, SK Telecom, energy groups Total and Air Liquide, and many others. A profile of the company a year later said it was worth over $1 billion.
Sigfox and its French subsidiary Sigfox France were both subject to the receivership/rehabilitation proceeding that was opened in the Commercial Court of Toulouse at the request of the CEO. The notice said it would last for six months. The most recent update is from earlier this month and seems to imply business as usual, announcing a partnership with two Semiconductor companies to advance its networking solutions.
The Sigfox group will be able to continue its commercial activities under the authority of mandators designated by the court.
This development shouldn't come as much of a surprise to those who have been keeping a close eye on the market. The company had to raise funding by the end of the year or risk insolvency, as Chris points out in the French Tech Journal.
Funding has not yet materialized.
The company's finances speak for themselves. In the last financial year, the company posted a net loss of over $90 million on revenues of over 24 million, and financial debts of over 120 million.
Sigfox was one of the biggest names in the Internet of Things to come out of Europe and its early and robust funding put it on the map among French startups trying to deliver innovative technology.
Sigfox emerged at a time when the concept of the Internet of Things was still in its infancy, with little in the way of lucrative business models behind it, and much of the activity being pushed by carriers who looked at it as an enterprise play and way to sell capacity on their established mobile
Sigfox's unique claim was not just that it was building a network, but that it was going to do so on a new kind of concept for making its networks and devices more sustainable and efficient. As we noted at the time, it was part of a bigger picture put forward by the company, about how Sigfox's understanding of how power and communication worked related to Simulation theory.
The simulation is part of the vision that I have, and I want Sigfox to be able to stay true to it. We are not living in the real world at the end of the day.
Jeremy Prince will be the new CEO after Moan parted ways with the company.
Despite the company's financial troubles, it seems that there is a business to be saved. Sigfox claims that its low cost and low energy technologies span across a global network that owned and operated by 75 operators, and that it seems to stitch together capacity from several other carriers for its own virtual network. The network covers a population of over one billion people in 75 countries and processes over 80 million messages per day. It says it has commitments from 5,000 customers to deploy 50 million objects.
We will update this post as we learn more.
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