Winnipeg-based legal, accounting online marketplace Vexxit to shutter

Hey there, time traveller!
This article was published 23/08/2024 (765 days ago), so information in it may no longer be current.

It was always going to be a vexing challenge: encouraging individual and small businesses to source legal and accounting services in a virtual environment.

In 2020, Winnipeg tech startup Vexxit thought it had a winning model to accomplish just that, with specially designed algorithms to match the consumer or small-business operator with the best professional service provider.

This week, however, the company let its community know it was closing up shop at the end of August, after running out of cash and still not having created enough traction in the marketplace to sustain operations.

“This was not something any of us had hoped for. We still think it’s a bloody good idea,” CEO Rick Duha said Friday.

Duha, former managing director of family-owned Duha Group, was brought in to run the company two years ago, after it pivoted to a consumer marketplace model (where Vexxit earned revenue from business transacted) from a subscription model (originally the lawyers and accountants had to pay to be on the platform).

In addition to the fact it was believed to be one-of-a-kind, there were plans from the start to scale Vexxit across the country and potentially internationally.

Although people need and engage in all the specific professional services Vexxit’s platform eventually settled on there was not enough up-take for $479 personal wills or uncontested separation agreement with property ($2,099) on offer.

“We have about 400 professionals who said they were excited about the concept of what we were trying to do and were very supportive,” Duha said. “But try as we may to convert on the consumer side, we just didn’t get enough traction to be able to stay open.”

The company was founded by a blue-ribbon group of successful entrepreneurs, including Duncan Jessiman, executive vice-chair and founder of Exchange Income Corp.; Polly Craik, former owner of FineLine Solutions; and original investor Dave Johnston of the Johnston Group.

David Asper was the out-going chairman of the board of directors.

Duha would not disclose the amount, but Vexxit had a couple of successful rounds of fundraising, with enough cash on hand — at one point — to have around 10 employees and hire a high-priced CEO from Montreal.

In its last days, there were “less than a handful” of employees, he said.

Duha insisted Vexxit was addressing a real need in the market: access to legal and accounting services to Canadians remains a problem, especially outside urban areas.

“We thought we had the right solution,” he said. “Apparently, we don’t. The people have spoken on that.”

Duha said there is no intention to try to sell off any portion of the business or intellectual property it developed.

“Right now, we’re just trying to make sure employees are looked after, the bills paid and we’ll close the doors with grace,” he said.

martin.cash@freepress.mb.ca