1 month ago
22
The world of startups can be a very strange place.
In a letter to investors it was announced that Bolt founder Ryan Breslow is returning as CEO to the beleaguered startup and raising a fresh $450 million at a $14 billion valuation from investors in the United Arab Emirates and the U.K., The Information reported.
The valuation is quite the turnaround for Bolt, which earlier this year offered investors a share buyback program that valued the company at a mere $300 million.
Bolt was one of the golden children of the go-go venture days of 2020-21. The company raised $355 million led by BlackRock in 2021 that valued the one-click online checkout startup at $11 billion as it rode the pandemic-fueled euphoria for online retail.
However, things quickly turned for the San Francisco-based startup as lawsuits, money-related infighting and more brought unwanted headlines. In early 2022, Breslow left as CEO after a Twitter tirade in which he trashed Y Combinator and Stripe. The company then announced layoffs — just six months after being valued at $11 billion — and has undergone at least three rounds of layoffs since then.
The startup also was sued by Authentic Brands Group for its botched integration with retail chain Forever 21, claiming the retailer lost more than $150 million in online sales as a result.
The company also has seen a litany of board changes and issues with its investors, and earlier this year former CEO Maju Kuruvilla left the company.
More bad blood?
That infighting may not be over.
Per the new report, the new capital being raised demands previous investors buy into the new round “in a proportion that is double their existing percentage stake,” or their stock will lose its preferred status and many shares may be bought back for about a penny.
That may roil some older investors, especially considering the company wanted to buy shares back at a $300 million valuation just months ago and now wants investors to dole out more cash at a $14 billion valuation.
Bolt already has raised nearly $1 billion from investors that include General Atlantic and Tribe Capital.
If Bolt’s history has shown us anything, it is that more investor squabbles and infighting are forthcoming.
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Illustration: Dom Guzman
