Evaluating only Addi (2023 crisis)’s profile at its peak — without knowing the outcome — the model ranked Unit economics as the #1 likely cause. That’s exactly how it died.
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Documented cause
Addi built a buy-now-pay-later platform for Colombian retail, raising $400M and processing billions in transactions. When global interest rates rose sharply in 2022-2023, Addi's cost of capital exceeded its loan yields. The company laid off significant portions of its workforce in 2022 and 2023, paused expansion, and restructured its lending book to focus on lower-risk, higher-margin segments.
Lesson
“Emerging market BNPL carries currency risk on top of rate risk. When dollar funding costs rise while local currencies weaken, the model breaks on both ends simultaneously. Price this risk into your unit economics from day one.”
FAQ
What happened to Addi in 2022-2023?
Addi, Colombia's leading BNPL platform with $400M raised, laid off significant portions of its workforce in 2022 and 2023 after rising global interest rates made its cost of capital exceed loan yields, forcing a restructuring of its lending book.