Sydney start-up collapses in wake of FTX crypto crash

A Sydney mum poured her $175,000 life savings into a business idea – but an event on the other side of the world saw the venture fold before it took off.

When Australian mum-of-two Eleanor Meireles heard last year that US cryptocurrency exchange FTX had filed for bankruptcy, it barely registered.

The business owner – from Sydney, on the other side of the world – did not use the exchange and didn’t see how it would directly impact her.

However, in the days that followed, she soon realised what the collapse of the $US32 billion crypto exchange FTX – whose CEO is facing fraud charges for running a Ponzi scheme – would mean for her.

Ms Meireles, 39, had sunk $175,000 into her business idea – an app called Dwell Nicely.

“I had savings from owning a restaurant. It was my life savings, literally hundreds of thousands, from over the years,” she told news.com.au.

After four years, the entrepreneur got the app off the ground, but the money dried up and she “started the hunt for investors”.

Here, she came across an old friend who offered to invest in the company and bring along many other resources including a team of software developers.

She was all geared up for her business to finally take off, when in November last year, she received some devastating news.

Her primary investor had 80 per cent of his cash in FTX – and is unlikely to get any of it back. He had to abruptly pull out of the project.

Now Ms Meireles has had to shut down her app, with no money left to pay operating costs, and has been left unemployed and devastated by having to abandon the idea which has taken up five years of her life.

The investor messaged her warning he would no longer be able to fund her project.

Ms Meireles, originally from the UK, said she came up with the idea for Dwell Nicely when she moved to Sydney but struggled to find a place to live as she had no local rental history.

She also had a property back in the UK but found the property manager useless, with rent going unpaid for months.

Here she realised there was a need in the market for easier ways to connect with renters and landlords and cut out property management.

With experience in finance, she came up with the idea of a kind of ‘Tinder’ for landlords and renters who could match with people who were the right fit.

“You’d swipe left and right (on landlords and renters), you could follow the process on the app, setting up the lease, onboarding, condition report etc.”

She and her business partner poured their funds into the venture and in 2020, the app launched.

“We had a fairly successful launch, there were quite a few downloads,” she said.

She was inundated with renting questions and grew a large following on Instagram and she even started studying a real estate qualification to help her customers.

Dwell Nicely helped renters and landlords connect.

It acted as a kind of ‘Tinder’ for property matches.

However, Ms Meireles was left frustrated after being deceived by three different teams of software developers that she hired.

Two software teams ghosted her and when she hired the third, they took $5000 to complete the job – and then disappeared.

“We had a really bad taste in our mouths,” she said. “The fact this investor was bringing a dev [software development] team to us was just priceless.”

The investor planned to raise money through crowd-funding, then a venture capital firm near the end of the process, and also a large angel investor.

“Then FTX crashed and it all went away,” Ms Meireles said.

Eleanor Meireles and her family.

Ms Meireles has been left devastated.

After their money ran out initially, Ms Meireles took the app down and left it “dormant”.

To keep her project alive, she and her business partner kept paying for tax returns, storage and server fees for the app, which was around $1000 each per month.

It was at this point they came across the investor, who offered a $30,000 cash injection as well as his team of developers.

“I used to work with him back in the UK, he’d just finished helping another company going to IPO, he’d been through the rounds – I trusted him,” she said.

But in November, when FTX sensationally imploded, she received a devastating WhatsApp message where her worst fears were realised.

“FTX files for bankruptcy. I had six figures capital in it,” he texted her.

He had close to $1 million in the failed exchange, which was 80 per cent of his overall wealth.

She asked him if there was any chance of recourse for him, to which he replied: “Don’t think so.”

He added, “My stress is going to give me a heart attack,” and said that he wouldn’t be able to help her for the next two years until he was able to get back on his feet.

Ms Meireles has since abandoned her project – although she lives in hope that one day it will make a comeback, as she has kept the business registered.

“It’s so hard to let go. It’s such a stressful situation,” she said.

Ms Meireles has now moved to Brazil, her husband’s home country, but doesn’t have a visa to work there.

“I am trying to desperately earn a living online through any way I can,” she said.

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