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Stratos CEO sells the company to keep its smart credit card alive

Existing orders will be filled and cards will continue to work

Stratos — one of a number of startups trying to combine all your credit, debit, and gift cards into one supremely capable smart card — has been sold to a company called Ciright One LLC. Stratos cards will "continue to function as they always have" under the new ownership, according to Stratos CEO Thiago Olson. Ciright will also manage and fulfill any Stratos card orders that haven't been filled. Further terms of the deal have not been disclosed.

TechCrunch reported yesterday that Stratos was shutting down, citing the fact that the company's building in Ann Arbor, Michigan is up for sale, that its social media posts had halted, and that users' support requests had gone unanswered. "As some have noted, there has been a disruption in our historically high level of member support," Olson tells The Verge. "With this new relationship, we plan to return to our usual level of support in the coming weeks."

Stratos was struggling, and the company lost a recent round of funding, so Olson paused operations and looked at restructuring. He then struck a deal with Ciright One, a Pennsylvania-based smart card company that has been working on a very similar idea to the Stratos card.

Stratos card

The Stratos card itself was an impressive technological feat. Stratos was able to fit all the card's smarts — a Bluetooth radio, a battery, touch sensors — inside without making it any bigger than a typical credit card, something the company's competitors struggled with.

The Stratos card processed payments just like any magnetic stripe credit card, though it wasn't equipped with the gold chip that is becoming common thanks to chip-and-PIN cards. (In fact, the most recent thing tweeted from the Stratos Twitter account addresses this, with the company saying it was working on a solution.) The twist was that it could store an unlimited number of credit, debit, or gift cards. Users could preload three of these for quick use on the card, and selected them by tapping the card twice and then pressing one of the three buttons on the right side of the card. An accompanying smartphone app let users swap which accounts were loaded on the card.

Stratos came up with some unique features, and was planning to do more

But Stratos had bigger ambitions than just enabling multiple accounts on one card. The company touted location-based services (the app could notify users of nearby deals, or that they were close to a store they might have a gift card for) and security enhancements (the ability to lock down your card if it was left out of Bluetooth range). And since users bought into Stratos with one- or two-year memberships, the company was promising bigger and better things on the horizon — a second version was supposed to be equipped with NFC to help compete with Apple Pay and Android Pay, for example. Those might no longer be realized, and the Stratos staff faces an uncertain future. "A lot is in flux right now," Olson says.

The Stratos card's sleek look gave it a design advantage over competitors like Swyp, Coin, Plastc, and LoopPay, and the company appeared to be on track to round that out with those rich features; as TechCrunch notes, the company had raised almost $7 million before launching earlier this year.

But the advancement of mobile payment services in the last two years has been swift, and so these companies have faced a challenge: even if you can build similar functionality, you have to compete with a person's phone, which is indispensable. LoopPay was bought by Samsung to beef up the phone maker's own mobile payments service, Samsung Pay. Plastc is compatible with chip-and-PIN as well as NFC, but the card needs to be charged, and the company isn't shipping them until April of 2016 anyway. Swyp is similarly compatible and feature-rich, but ships even later. Coin finally rolled out a second, NFC-equipped version of its card in August, but some owners won't get replacements until "early 2016," and the company's path to that milestone was rocky at best.