The CEO of UNest, a college savings app that raised almost $40 million, says the company is insolvent, according to leaked email

• Ksenia Yudina founded UNest in 2018 to make it easier for families  to save for college.
• The company raised close to $40 million and signed Baron Davis and Laura Dern as brand ambassadors.
• Now Yudina is resigning and UNest is insolvent, according to an email obtained by Insider.

Ksenia Yudina, the founder and CEO of fintech startup UNest, sent a foreboding email to the app’s investors and advisors on Friday morning.

“I regret to inform you that I resigned from my position as CEO of UNest following the Board meeting on 10/11,” Yudina said in an email obtained by Insider. “The company is currently insolvent and is in default with our venture debt provider Silicon Valley Bank in the amount of $3 million.”

Yudina, UNest communications, and Mike Doniger, the company’s COO, did not respond to requests for comment.

Yudina, a former Capital Group vice president, founded UNest in 2018 to make it easier for families to save for their children’s college education. The app later added ways to save for other major expenses such as weddings and down payments on homes.

UNest received nearly $40 million in funding from investors such as the Artemis Fund, Anthos Capital, Franklin Templeton, and Northwestern Mutual. UNest acquired two fintech companies, Littlefund and Kidfund, and signed NBA All-Star Baron Davis and Laura Dern on as “brand ambassadors.”

According to Pitchbook, the company last raised a series B funding round led by the Artemis Fund at a $126 million valuation at the end of 2021.

“UNest’s growth has wildly exceeded our expectations,” Yudina stated at the time.

What went wrong since then is unclear. However, many financial technology startups have struggled in the last two years due to a lack of venture funding and skyrocketing interest rates.

Some venture capitalists have warned of a “mass extinction event” for startups as funding dries up and companies struggle to be acquired or go public. According to Crunchbase data, 132 startups have closed their doors this year.

Yudina stated in her Friday email that UNest had two options to avoid bankruptcy: an assignment for the benefit of creditors liquidation or a hostile takeover by a new investor.

Yudina stated that she and the board agreed to the liquidation at first, but she became skeptical after the company’s legal counsel “highlighted multiple legal, compliance, regulatory, and operational risks.”