Convictional Shuts Down After Failed AI Pivot
AI-generated image · Bay Street Wire
The Kitchener-Waterloo startup will return remaining investor funds after failing to find product-market fit for its corporate collaboration platform.
As BetaKit first reported, Kitchener-Waterloo-based startup Convictional is set to close its operations permanently on Aug. 27. The decision comes after the company attempted to pivot from e-commerce into the AI space, aiming to build a corporate collaboration alternative to Slack.
Founded in late 2017 by former Shopify employees Roger Kirkness and Chris Grouchy, Convictional originally focused on connecting retailers with suppliers. The company later developed Modern Dropship, which reached 3,000 customers and $2 million USD in net annualized revenue. However, Convictional divested that business in early 2025 to California-based competitor Carro after leadership and investors saw limited growth potential. CEO Roger Kirkness noted that other growth areas in retail e-commerce were already being addressed by Shopify.
The company's subsequent effort, "Convictional 2.0," focused on a collaboration platform based on the thesis that AI would shift corporate work from tasks to judgment. Despite a relaunch a few weeks ago, Kirkness told BetaKit that the company lacked enough paying customers to build a viable business, noting that larger firms were developing similar tools in-house while smaller firms presented "sustainable distribution" challenges.
Convictional raised nearly $49 million USD ($68 million CAD) in venture capital from investors including Garage Capital and Y Combinator (YC)’s growth fund. Because the company still has several years of runway, Kirkness plans to return slightly less than half of the total funding to investors. Kirkness, who made the decision to close the company, intends to open-source the firm's intellectual property and research.