The startup world can be a very strange place.
In a letter to investors, it was announced that Bolt founder Ryan Breslow returns as CEO of the struggling startup and raises an additional $450 million at a $14 billion valuation from investors in the UAE and the UK, The information reported.
The valuation represents a turnaround for Bolt, which earlier this year offered investors a share buyback program that valued the company at just $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, the one-click online payment startup was valued at $11 billion as it rode the pandemic-induced euphoria for online retail.
However, things quickly turned around for the San Francisco-based startup, as lawsuits, financial disputes, and other events made unwanted headlines. In early 2022, Breslow stepped down as CEO after a Twitter tirade in which he trashed Y combiner And BandThe company then announced layoffs — just six months after being valued at $11 billion — and has seen at least three rounds of layoffs since then.
The startup was also sued by Authentic Brands Group for its failed integration with the retail chain Forever 21claiming the retailer lost more than $150 million in online sales because of it.
The company has also seen a litany of board changes and problems with its investorsand earlier this year, former CEO Maju Kuruvilla left the company.
More bad blood?
These internal struggles may not be over.
According to the new report, the new capital raised requires previous investors to buy into the new round “in a proportion that is double their existing percentage stake,” or their shares will lose their preferred status and many shares could be bought back for about a penny.
That could unnerve some older investors, especially since the company wanted to buy back shares at a $300 million valuation just a few months ago and now wants investors to pour in more money at a $14 billion valuation.
Bolt has already raised nearly $1 billion from investors including General Atlantic And Capital of the tribe.
If the Bolt story has shown us anything, it’s that more investor squabbles and infighting are coming.
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Illustration: Dom Guzman
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