London based taxi-booking app Karhoo, has filed for bankruptcy protection in New York.
The Karhoo app, which let customers to compare cab fares on smartphones before booking a ride. Founded in November 2014 by Daniel Ishag, the Startup ran out of money after expanding from London to nine other English cities, Paris and Singapore.
“It is with much regret that we have to announce that Karhoo has had to close its service and is now looking at the next steps for the business. The board is taking advice in that respect.
The Karhoo staff around the world in London, New York, Singapore and Tel Aviv have, over the past 18-months, worked tirelessly to make Karhoo a success.
Unfortunately, it became clear two weeks ago that the financial situation was getting pretty dire with Karhoo in urgent need of funding. Discussion with a potential new backer ended last night forcing the company to stop trading.
We would like to thank our staff, our partners, the fleets around the world that shared our vision, and the hundreds of thousands of people who downloaded the app and supported what we were trying to do.” said the official statement released by Karhoo.
Karhoo had problems with fraud that caused a large number of credit card payment rejections, and it was generous with refunds to customers who had a bad experience. Also, coupons were used indiscriminately to bring more customers onboard which led to this financial turmoil.