CEO says Google’s algorithm updates decimated SEO-reliant financial product referral revenue.
Montréal-based FinTech startup Hardbacon, which offers a free budgeting app and generates revenue through lead generation and affiliate marketing for financial products, has shut down after seeing most of its Google traffic vanish over the past year, following some updates to the search giant’s algorithm.
Hardbacon announced in an Aug. 15 blog post that it has suspended its operations, let go of its remaining employees, and plans to declare bankruptcy “in the coming days.”
This move comes 11 months after Google implemented some updates designed to combat spam that led to a steep decline in hits to Hardbacon’s website, a blow from which the search engine optimization (SEO)-reliant company was never able to recover, co-founder and CEO Julien Brault told BetaKit in an interview.
“They killed really bad websites, and they killed a bunch of good websites as well.”
Since Google’s “helpful content update” in September 2023, Brault said Hardbacon has lost 97 percent of its traffic from the search engine. While Google’s most recent updates have led some of the company’s traffic to return, Brault said this latest change is unfortunately too little, too late for Hardbacon. “We’re still in a bad situation,” he said.
“It’s sad because, for 11 months, we dug ourselves a huge financial hole,” Brault added, noting that the startup remains in the process of filing for bankruptcy. At the time of publication, Hardbacon’s app and website remain functional, but Brault noted that both may stop working in the next few weeks if the startup’s trustee stops paying for hosting.
According to Google, the company’s helpful content system is “designed to better ensure people see original, helpful content written by people, for people, in search results, rather than content made primarily to gain search engine traffic.”
Designed to deprioritize unhelpful SEO-driven and artificial intelligence (AI)-produced content, Google’s changes have impacted a broad swath of businesses that rely on SEO and online content, including Hardbacon, HouseFresh, New York Magazine, GQ, Urban Dictionary, and Tuta Mail, among others. “They killed really bad websites, and they killed a bunch of good websites as well,” Brault claimed.
A Google spokesperson declined to comment on Hardbacon’s situation or the ranking of any other individual websites to BetaKit, noting that Google launches thousands of updates to search each year. The company did claim, however, that its March updates “were not specifically designed to target pages with affiliate links,” but rather focused on deprioritizing content made solely for the purpose of ranking well on search and attracting clicks rather than helping people.
The Google spokesperson noted that the company takes feedback from “users, publishers, and the SEO community seriously,” adding that in response to reactions from creators and others, the company adjusted its algorithm this month to better surface small or independent sites. For its part, Hardbacon said the company’s latest updates helped but came too late.
Brault, a former book publisher and business and technology journalist, co-founded Hardbacon back in 2017 as a platform for retail investors to analyze and manage their portfolios. After struggling to monetize this app through subscriptions, in 2020 Brault said the startup pivoted to focusing exclusively on a component it already offered—budgeting—and layering on financial product comparison tools and educational personal finance content to draw consumers in.
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“Our goal with Hardbacon was to help the little guys get as much as they can from their money,” said Brault.
Since 2020, Hardbacon has offered its budgeting app for free and the startup has generated revenue through lead generation and affiliate marketing via SEO for financial institutions, collecting a fee for connecting consumers with products like credit cards, bank accounts, and insurance, as well as sponsored content. To fuel its efforts, Hardbacon had raised approximately $3 million CAD in total funding to date from approximately 2,000 individual investors via crowdfunding.
While Hardbacon’s app has 50,000 registered users, Brault said its active user count was far lower thanks to Canada’s lack of open banking, “plateauing” at about 2,000 because of difficulties users faced connecting their financial accounts so their spending and saving could be monitored on the app. “The problem is the churn was high because accounts keep disconnecting, like every f-cking day,” he said.
Prior to Google’s September 2023 updates—the rollout of which concluded on Sept. 28—Brault said Hardbacon had 10 employees. That September, just before the updates, he said the company had 400,000 unique website visitors and booked $55,000 in revenue.
According to Brault, Google’s September 2023 updates and all of the changes it has made to its search algorithm since then—save for the latest ones—have resulted in Hardbacon losing Google traffic.
“I guess we looked like a spam website in the eyes of Google,” he said.
Brault said Hardbacon tried everything to rectify the issue, spending months trying to fix its SEO issue, improving its content and website, reducing its expenses and whittling down its team until the company only had Brault and two employees remaining. Hardbacon laid off those two people and ultimately decided to pull the plug this month.
Hardbacon’s story has some parallels to that of Canadian-founded Apollo, a third-party app for browsing the online discussion platform Reddit. Apollo also shut down last year in response to changes made by a big tech company: in its case, the app was priced out by Reddit’s changes to its application programming interface (API) policies.
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Brault characterized Google’s search dominance as “highly problematic.” According to Statista, globally Google currently owns more than 80 percent search engine market share on desktop, down a bit from the 90 percent it held in 2019, with Bing accounting for 10 percent and the remainder spread out across a variety of players. Brault argued that this makes Google “the internet by themselves.”
“It’s not sustainable to have only one search engine on the internet, and when you have 90 percent of it, you become, de facto, the judge of who will survive on the internet and who can do business on the internet,” Brault said, adding that this is why antitrust regulations exist.
What makes things even more bittersweet for Hardbacon is the fact that in a landmark antitrust case south of the border, a United States judge recently ruled that Google acted illegally to maintain a monopoly in the search space. In Hardbacon’s blog post, Brault noted that this and other pending legal cases suggest that Google may lose ground due to its allegedly anti-competitive behaviour.
Brault claimed that he has already been approached by at least 20 credible potential buyers, and hopes to see Hardbacon’s tech and content live on in some capacity, but emphasized that the matter is now in the hands of Hardbacon’s trustee.
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As to what comes next for him, Brault said he doesn’t know at this point, noting that he is still engaged in the bankruptcy process, but added that he will probably try to find another job afterwards.
Brault said Hardbacon considered all possible options, including implementing a subscription fee for its budgeting app. The CEO said Hardbacon decided not to go that route given its past experience and expressed doubt that it would have made a difference.
“If [this] can be a reminder for other entrepreneurs to diversify their marketing acquisition channels, then that’s good.”
Since Hardbacon announced the news earlier this month, Brault noted that some folks have argued the startup was too concentrated on a single marketing acquisition channel.
For his part, Brault said that Hardbacon focused its efforts entirely on SEO and Google traffic because it was the most profitable, noting that this strategy has proven fruitful for larger, Nasdaq-listed NerdWallet.
“When you do lead generation for financial institutions, you need high-intent people,” Brault said. “How do you find people that have a high intent of getting a credit card or insurance? They go to Google and they say, ‘What’s the cheapest insurance for single parents?’ or something like that.”
Brault noted that it is easy to lay blame on Hardbacon’s concentration on SEO in hindsight, but also acknowledged that had the startup diversified its approach, the outcome may have been different. “Next business, I won’t do any business that I need to rely entirely on SEO—that’s learned for life,” he said.
“If [this] can be a reminder for other entrepreneurs to diversify their marketing acquisition channels, then that’s good,” Brault added.
UPDATE (08/29/24): This story has been updated to include comments from Google.
Feature image courtesy Hardbacon.
