Nate CEO Albert Saniger. Art by Mike Sullivan
June 6, 2022 6:00 AM PDT

Some startups are bold and original. And some, like Nate, had more modest goals: automatically filling out shoppers’ contact and payment information on retailers’ websites. In exchange for sparing them a minute or two of data entry on their phones, Nate charged shoppers $1 per transaction.

But it struggled to turn even that vision into reality. While the company said it was using artificial intelligence to populate customer information during the checkout process, it had actually hired workers in the Philippines to manually enter the data on retailers’ sites for a significant portion of the transactions Nate facilitated in 2021, according to two people with direct knowledge of the company’s practices. That meant customers’ orders were sometimes placed hours after they clicked the buy button through the Nate app. Nate didn’t disclose its decidedly low-tech methods to at least some of the investors from whom the startup tried to raise money, according to a person with direct knowledge of fundraising discussions.

Still, Nate has landed backing from well-known venture capital firms, including Coatue Management and Forerunner Ventures, who collectively invested more than $50 million in the startup over the past two years. Transaction volumes never took off, and late last year Nate offered a juicy promotion to get people to make purchases through the app: New customers could receive $50 to spend at select retailers like Best Buy and Walmart. But the move backfired when users discovered they could create multiple accounts, launching a feeding frenzy to collect the free cash, said two people with direct access to an internal transaction data dashboard. Customer orders surged during the promotion but tumbled back to pre-promotion levels when the company ended it around Christmas, these people said.

Get access to exclusive coverage
Read deeply reported stories from the largest newsroom in tech.
Latest Articles
 
The Weekend Crypto Startups
Truth or Consequences: Would You Take an AI-Powered Polygraph Test to Prove You Hadn't Cheated on a Spouse?
Truth or Consequences: Would You Take an AI-Powered Polygraph Test to Prove You Hadn't Cheated on a Spouse?
Hi, welcome to your Weekend! Even before the Supreme Court’s earth-shaking rulings this week that struck down states’ gun restrictions and ended women's right to an abortion, Americans were losing faith in the highest court in the land. On Thursday, Gallup reported that trust in the Supreme Court has never been lower, with only 25% of Americans responding that they had a great deal of...
Latest Briefs
 
Congressional Report Says Robinhood Understated Liquidity Problems During Meme Stock Craze
Zendesk Agrees to $10.2 billion Buyout Months After Rejecting Higher Bid
Meta Plans To Shut Down CrowdTangle Tool
Stay in the know
Receive a summary of the day's top tech news—distilled into one email.
Access on the go
View stories on our mobile app and tune into our weekly podcast.
Join live video Q&A’s
Deep-dive into topics like startups and autonomous vehicles with our top reporters and other executives.
Enjoy a clutter-free experience
Read without any banner ads.
Jerry Seinfeld (left) and Ted Sarandos. Photo by Getty. Art by Mike Sullivan
Exclusive Media/Telecom Amazon
A Netflix Slump Tests Sarandos’ Talent Savvy
In 2019, when comedian Mike Myers was pitching a new comedy series to Netflix, program executives at the company were skeptical.
Crypto Markets
Tech’s Worst-Timed Deals: Six Acquisitions That Have Not Improved With Age
As tech valuations collapse to a fraction of where they were last year, executives likely have a few regrets.
Amazon's logo on a tent at Cannes this week. Photo by Reuters.
Amazon
Amazon’s Ad Staffers Flee Amid Complaints of Bloat, Bureaucracy
In the years immediately before Covid-19 sidelined the global advertising festival in Cannes, Amazon kept a low-key presence at the annual gathering of ad and tech people.
Signage at VidCon 2016. Photo by Shutterstock
VidCon Returns as Chill Falls on Creator Economy
VidCon, the annual gathering of social media creators, fans and industry representatives, will descend on Anaheim, Calif., Wednesday for the first time since 2019.
Art by Clark Miller
Scene and Heard Crypto Culture
‘The Last Great Party’: With Crypto Winter Coming, NFT Lovers Try to Stave Off Reality
Ten days before NFT.NYC began last Monday in New York, I interviewed the conference’s founder, Jodee Rich, about how the crypto market’s collapse would impact this year’s gathering.
Opinion Media/Telecom
The Question Plaguing Connected TV: Who’s Watching?
PARQOR is part of The Information’s newsletter network. To receive it in your inbox every Monday, Wednesday and Friday, sign up here .