Bolt did not complete controversial $14b fundraise from last year
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Bolt confirmed today that it had cleared up the bevy of legal cases against the company, but it didn't say whether it had completed its controversial 2024 fundraising attempt.
Why it matters: That deal, which carried a $14 billion valuation and would have crammed down existing shareholders, was never completed, four sources familiar with the situation say.
- When the attempted deal first came to light, existing investors balked, with BlackRock and Hedosophia suing to block it last year. Investors that have remained with the business include Invus and Streamlined Ventures.
- The deal also called for Ryan Breslow to return as CEO. Even without the deal's consummation, Breslow was reinstated this month.
- Since his return, Breslow has had discussions to raise new capital, but he's also said the company has two to three years of runway.
Zoom in: This all comes as Breslow seeks to reinvigorate his super-app ambitions, something that could be costly and which had previously been pared back by his 2022 CEO successor, Maju Kuruvilla.
- During the Fintech Meetup conference, Breslow compared his plans to those of fintech giant Revolut, and he spoke of launching peer-to-peer payments, crypto, cards and other financial products all in one app.
The intrigue: Why would investors stay in? Newcomer previously reported that Bolt's annualized run rate was at $28 million in revenue at the end of March 2024. Bolt also bought back shares from several investors last year (including Tribe Capital).
- When asked about why they still believed in the business, one investor described the industry as lumpy. Yes, revenue looked bleak. But all it takes for such a payments business to rise is a successful partnership with the right commerce giant — and Bolt has been stellar at inking high-profile partnerships, just less so at maintaining them.
- On the flipside, governance remains a concern to investors, with the recent attempted cramdown cited. This was a major argument in Activant's lawsuit, which alleged that Bolt had replaced board members repeatedly (five in nine months) and ended up with yes-men.
BlackRock, Hedosophia, Streamlined and Invus did not respond to requests for comment.
