Summary:
Flip, a California tech startup with a $1 billion valuation, shut down in 2025 after a brief but explosive growth period.
The app combined TikTok-style videos with e-commerce, rewarding users for watching and shopping, but struggled with a unsustainable business model based on heavy discounts.
At its peak, it had 16.5 million users and facilitated $375 million in sales, but couldn't compete against giants like TikTok and Instagram.
A $144 million funding round in 2024 wasn't enough to save the company, leading to its abrupt closure and layoffs.
This shutdown highlights the high risks in the social video and e-commerce startup space, where even well-funded ventures can fail quickly.
The Rise and Fall of Flip: A Cautionary Tale in Tech
Flip, a California-based tech startup, recently shut down after achieving a $1 billion valuation in 2024. The company, operating under the name Humans Inc. in El Segundo, gained fame for its e-commerce app that mimicked TikTok's short-form video style, allowing users to shop, watch videos, and earn rewards.
File: Young people use smartphones in a circle. In recent years, short-form video has merged with e-commerce on some popular apps. Xavier Lorenzo/Getty Images
How Flip Operated and Its Sudden Demise
The app blended features from major platforms: a TikTok-style video feed, Amazon-like shopping carts, and a rewards system where users and creators earned money and discounts for engagement. At its peak, Flip boasted 16.5 million users, 5 billion video views, $13.4 million paid to creators, and $375 million in sales for brands.
However, the company's website was scrubbed clean after August 16, 2025, replaced with a message titled "Thank you for making Flip real," announcing the shutdown. Its social media accounts and app listings vanished, leaving many questions unanswered.
The Underlying Issues
Flip's business model relied heavily on discounting products, which raised concerns as early as 2023. Despite a $144 million funding round in April 2024 that cemented its unicorn status, the company couldn't sustain operations. The competitive landscape, dominated by giants like TikTok and Instagram, proved too challenging for this upstart.
Employees have since updated their LinkedIn profiles with "#OpenToWork," highlighting the human impact of the shutdown. This event underscores the difficulties faced by startups trying to disrupt established social video and e-commerce markets.
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