A fintech funded by Y Combinator, which has attempted to bring financial services to those living in so-called "banking deserts," has been shut down, according to its founder, Sheena Allen.

Allen wrote about it on LinkedIn and confirmed it to TechCrunch.

I am proud of the work we were able to accomplish, but honestly disappointed that we could not complete the mission," she wrote. "I feel strongly that there is still much work to be done in the financial inclusion space, so it won't be the last you hear of me in regard to fighting for economic equality.".

Allen said the company had already begun to wind down last year, having waited this long to make the announcement after a deal that could have potentially acquired the company had fallen through.

Banking deserts: People in communities, often rural, have no nearby physical bank branch from which to obtain a checking account. The term is also applied to those who have challenges traveling to a bank, such as lower-income, older, or disabled individuals.

Allen, above, founded CapWay in 2016 after learning about the effects that not having a bank account has on certain communities - reliance on high-interest payday loans or even cash-checking services that cost people enormous fees, according to CNN.

The company had planned to cater to this segment by teaching people financial literacy and providing banking solutions online. According to Pitchbook, the company raised just under $800,000 funding from investors such as Backstage Capital, Fearless Fund, and Khosla Ventures. It was part of the Summer 2020 cohort of YC, according to TechCrunch at the time.

Allen said that she had a number of reasons why she closed the company, but perhaps most notable was that the fintech industry took quite a huge reputational hit after the hacking of Evolve Bank & Trust and the collapse of Synapse, the latter of which saw hundreds of millions of consumer funds frozen.

The thing was, after this, many banks that wanted to do it with fintechs started demanding the fintech to have a minimum amount in a bank.

"It takes money to play in a highly regulated industry because you can't control the changes," Allen said. "You just have to have enough money and time to survive the adjustments.".

This also occurred to CapWay during this time, but it did not have the ability to raise enough more money to meet the money-on-hand requirements of potential partners, which it could not do.

Some investors turned her away, stating that the company was behind its competitor by too much.

But she also pointed out what has pained many Black founders this past year.

"Fundraising itself was down for everybody, but it was and is extremely down for Black founders," she said. Crunchbase discovered that Black founders raised only 0.3% of the $79 billion that went to U.S.-based startups during the first half of the year.

Allen often found herself competing for that smaller pie of pie with other Black-founded fintechs. She wrote in her post, "Some investors took the time to flat out tell me that they had already 'written' checks to another Black-founded debit card fintech.".

Some investors like to group all Black fintech companies into one box, [even] when we don't all do or operate the same or have the same target audience," she said. "It's unfortunate, but that was a factor in us being told no a few times.".

On her LinkedIn, Allen appreciated the "some of my investors and my team who supported, motivated and even humored me throughout this rollercoaster journey," indicating that there were investors who "still called and not only checked on the business and me as a founder but me as a human." She was thankful also for her fellow founders who "listened to me rant and called to simply check on my mental state through this process.

But one failed startup-well, almost a badge of honor in the world of startups-hasn't steered her away from her love of building companies. She still wants to work in the financial inclusion space, and she's contemplating what her next startup idea is going to be. She's looking at some potential entrepreneur-in-residence opportunities at venture firms.

"It's a rough time to wind up the company, but as I learned, there is beauty in the journey even on cloudy days when things seem dark."