Grabango, a cashierless tech competitor to Amazon, closes down after unsuccessful funding efforts.

• One of Amazon's top competitors in cashierless checkout technology is discontinuing operations.
• After failing to secure financing, the company had to make the "extremely difficult decision" to permanently close its doors.
• Aldi, Giant Eagle, 7-Eleven, and Circle K are among the grocers and convenience store chains that have struck deals with Grabango.

Grabango, a cashierless checkout technology startup that was seeking to compete with Amazon, is shutting down due to its inability to secure enough funding to remain operational.

"Despite being a pioneer in checkout-free technology, the company couldn't secure the funding needed to maintain its services, a spokesperson stated in a CNBC interview on Wednesday. The company expressed gratitude to its employees, investors, and clients for their efforts."

Food tech publication The Spoon reported earlier on Grabango's closure.

In 2016, Grabango was launched with checkout-free technology that utilizes computer vision and machine learning to monitor and record items as customers pick them up from store shelves. Will Glaser, the founder and CEO of Grabango, is a seasoned Bay Area technologist who also co-founded the music streaming service Pandora.

The company employed roughly 100 employees, according to LinkedIn and Pitchbook.

Grabango secured $73 million in funding, with its largest financing round occurring in 2021, before the market shifted. In June of that year, the company raised $39 million in a round led by Commerce Ventures, with participation from Peter Thiel's Founders Fund and the venture arms of Intel and Samsung.

Glaser revealed to Axios in February that the company intended to go public with a market cap of between $10 billion and $15 billion in a few years.

Since early 2022, the IPO market has been dry, with only three notable venture-backed companies debuting in the U.S. this year. The lack of liquidity has severely impacted the venture industry, making it challenging for firms to launch new funds and for startups, except for a select few AI companies, to secure funding.

In Berkeley, California, Grabango was viewed as a main competitor to Amazon's cashierless checkout service, known as Just Walk Out. Additionally, other startups in the industry, such as AiFi and Trigo, were also seen as rivals.

Grabango has partnered with grocers such as Aldi and Giant Eagle, as well as convenience store chains 7-Eleven and Circle K. Amazon has focused its Just Walk Out service on convenience stores and retailers located in airports, stadiums, and hospitals.

In April, Amazon removed its cashierless checkout technology from its U.S. Fresh stores and Whole Foods supermarkets. In a blog post following that decision, Glaser stated that Amazon's dependence on shelf sensor technology in its JWO system had been its downfall. Glaser revealed that Grabango had opted for computer vision instead of shelf sensors, which had put it on a course for widespread adoption.

"In a twist on the classic Tortoise and Hare tale, Glaser wrote that the roles of the players were reversed. While the larger Amazon initially took a commanding lead, it was unable to maintain it. In contrast, the more agile Grabango faced challenges on a technical level but ultimately emerged victorious due to its perseverance."

-- CNBC's Ari Levy contributed to this report.

Amazon is placing a significant wager on the sale of its cashierless technology to external customers.