The news that Fast, the startup focused on one-click checkout, would cease operations brings that old business aphorism to mind: You’ve got to spend money to make money.
And sometimes, the spending money — the cash burn — becomes too much to sustain operations. In an announcement Tuesday (April 5), Fast said that it would close its doors and discontinue Fast Checkout as a payment method on April 15.
“Sometimes trailblazers don’t make it all the way to the mountain top. But even in those situations, they pave a way that all others will follow. Fast has done that with bringing one-click and headless checkout into the mainstream,” CEO Domm Holland said in the statement.
As reported by several news sites including Protocol, cash burn was an issue. An unnamed Fast employee told Protocol, “We waited too long and we ran out of money.”
That employee said that Fast “misjudged significantly” the mood of venture capitalists (VCs) — presumably, we surmise, to keep investing money in the company.
And herein lies a conundrum for the startups that populate one-click checkout or any other number of payments innovations.
If VCs are becoming a bit more reluctant with loosening the purse strings, well, that might be understandable given the macro concerns hanging over us all — after all, VC firms have to show returns, too. Inflationary environments raise the bar on the investment returns that institutions (and retail investors) deem acceptable.
But for Fast, the issues may have been compounded by the fact that all manner of eCommerce competitors have been able to bring their own one-click features (or at least autofill options) to their own commerce ecosystems.
Amazon stands out, one-clicking away in eCommerce dominance.
There’s Shopify, too, of course.
As noted in this space earlier in the year, QisstPay, a buy now, pay later (BNPL) startup founded in Pakistan, is also entering the U.S. with one-click checkout for retailers. Last year, the company raised $15 million in pre-seed and seed funding rounds.
Read more: Pakistani BNPL Firm QisstPay Expands to US
Separately, Bolt has been busy enabling one-click commerce in, among other things, business-to-business (B2B) settings.
Back in May of 2020, as the pandemic raged, we spotlighted Fast and its Fast Login and Fast Checkout. Both facilitated a one-click sign-in and purchasing experience through any browser, device or platform.
Smoother checkouts would, of course, prove to be a boon for merchants trying to streamline the last steps of online commerce and decrease shopping cart abandonment.
By the time 2021 rolled around, Fast had raised more than $120 million. Barely five quarters later, the firm is shuttering operations — which gives you a sense of just how quickly fortunes can turn in as the competitive landscape becomes even more crowded.