A Canadian tech company plans to relaunch popular wellness app Carrot Rewards after its original founders failed to secure enough funding to keep the business running.
Toronto-based Optimity bought Carrot Rewards last month, and the company is still sorting through the assets. Financial terms were not disclosed.
The free app, which shuttered in June 2019 after its founders failed to secure enough funding to keep the business running, allowed users to earn rewards points from major loyalty programs, like Cineplex’s Scene and Petro-Canada’s Petro-Points, in exchange for meeting health and fitness goals.
It first launched in British Columbia in March 2016 with the province investing $2.5 million and the federal government contributing $5 million. The user base grew to about 1.1 million people across BC, Ontario, Newfoundland and Labrador, and the Northwest Territories, but funding ran dry.
The company already teased a relaunch via the program’s social media channels. On Christmas Eve, the app’s Twitter account tweeted for the first time since June. The tweet contained only a picture of a sign: a neon, lit up carrot and the words “stay tuned.”
People can already sign up to join a waitlist on the company’s website, which more than 45,000 people had registered to as of Monday afternoon.
Optimity is currently conducting research to see how to best build Carrot Rewards into a sustainable program.
The company is in talks with a number of rewards-program operators to find partners, said Jane Wang, CEO of Optimity. Though Wang declined to name any in particular, she called some “the usual suspects” while others will be different from before.
Andreas Souvaliotis, who founded the app in collaboration with the federal government, said “it will be a Herculean effort to relaunch.” Though, he said he absolutely believes it’s possible for the app to succeed and is cheering the new team on from the sidelines.
The loss of the Ontario Ministry of Health as a client presented the biggest operational problem, he said. Provincial health ministries previously made up the company’s anchor clients, but the former Ontario Liberal government stopped participating within a few months of signing up.
The program also required a complex web of points providers to purchase loyalty points from and such deals take a long time to sign, Souvaliotis said. Carrot Rewards also needed a number of significant government clients willing to pay for those points so app users could earn them for free by leading healthy lives.
The new owners face the additional challenge of convincing point providers that the revamped version will be viable, Souvaliotis said–as well as convincing governments that it’s unlikely to go bankrupt again.
Wang said that Optimity will use a different funding model for Carrot Rewards, but encourages anyone interested in supporting the venture to reach out.
When the new version of Carrot Rewards will launch is “kind of the million-dollar question,” Wang admitted, saying the company doesn’t have an exact date yet, but has a timeline in mind and plans to make more information available later.
By the time it shut down, Carrot Rewards operated in three provinces and one territory. Optimity sees an opportunity for global expansion. The company already operates in the US, so Wang sees going south of the border a natural move. She has also highlighted Asia as a lucrative opportunity.