A source of funding for several San Diego businesses, including Izola Bakery and Hommage Bakehouse, Mainvest small business investment platform has announced it will soon cease operations.
In an announcement to its community, Mainvest, the pioneering platform connecting local investors with small businesses, revealed its decision to cease operations, effective June 14th, 2024. This news comes as a heavy blow to its vast network, which has witnessed the platform facilitate over $30 million in investments across more than 450 businesses since its inception in 2019.
The CEO of Mainvest, Nick Mathews, expressed deep regret over the closure, citing a combination of internal and external factors that led to this difficult decision. Despite the team's dedication to their mission, the challenges proved insurmountable, necessitating the closure for the sake of the platform's users.
For businesses in San Diego, Mainvest served as a vital lifeline, providing a platform through which they could raise much-needed capital to fuel their growth and expansion endeavors. Among these businesses are local favorites like Izola Bakery and Hommage Bakehouse, which utilized Mainvest to finance their operations and connect with the community.
Once named by Yelp as the #1 bakery in the United States, IZOLA has already received more than $1.6 million in investment funds through Mainvest, but claims it is not enough. Ownership contends that building their zero-emission dough factory and bakeshop in San Diego's City Heights is a $7.5 million dollar project. The company is in the process of re-opening in the former Amplified Ale Works space in San Diego's East Village after closing its original location late last year due to violation of food permit requirements.
Hommage Bakehouse was on an aggressive growth plan after raising nearly $200,000 on Mainvest. Last year, the company seemingly went belly up and are embroiled in a lawsuit, along with sister concept La Clochette Du Coin, with New York City-based business financing firm, Capitalize Group LLC. Hommage Bakehouse LLC is also being sued in San Diego County Superior Court by Alliance Funding Group for breach of contract. The case was filed February 13, 2024, and Hommage is yet to respond to the complaint.
The closure of Mainvest raises concerns for San Diego businesses that relied on the platform for funding. With traditional financing avenues often presenting hurdles for small businesses, the absence of Mainvest leaves a void in the local entrepreneurial landscape.
As Mainvest prepares to wind down its operations, affected users are urged to take action regarding their custodial accounts. Notices regarding the closure of accounts will be sent out, with remaining funds to be disbursed to the address on file. Additionally, investors can expect to receive their full portfolio and transaction data via email by June 14, 2024.
Following the closure, the responsibility for processing repayments shifts to the issuers of revenue sharing agreements. Mainvest reassures investors that the closure does not absolve issuers of their obligations to repay investors according to the terms of the agreements.
To facilitate a smooth transition, Mainvest has established a consolidated Support Hub where users can find answers to their inquiries. While SMS, phone, and live chat support have been discontinued, email support will remain active until June 14, 2024.
For more information, visit mainvest.com.
