Posted: 1:00 PM PDT · September 13, 2024
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Julie Bort
Bolt, a one-click payments startup, has announced that it has settled its long-standing lawsuit with its investor, Activant Capital. The suit was filed by Activant against Bolt’s founder and former CEO, Ryan Breslow, accusing him of adding $30 million to the company’s balance sheet in the form of a personal loan and removing board members when they urged Breslow to repay it.
The Settlement: A Buyout of Activant’s Stake
In a statement released by Bolt, the company revealed that it has settled its lawsuit with Activant Capital by buying out the investor’s stake. This means that after the settlement, Activant will no longer hold any interest in Bolt. The terms of the settlement have not been disclosed.
The Backstory: A Turbulent History for Bolt
Bolt’s history has been marred by controversy and drama. In addition to the lawsuit with Activant Capital, the company is still reeling from a separate suit filed by one of its major customers, Fanatics. This lawsuit was also settled this week.
Moreover, Bolt is currently in the midst of another contentious issue: attempting to force its existing shareholders to buy more shares at an increased valuation based on a dubious term sheet involving a Special Purpose Vehicle (SPV)-based investor and $250 million of "marketing credits."
Investors Unimpressed
The move by Bolt has not been well-received by investors. Some are seeking to block the deal, citing concerns over the company’s financials and the legitimacy of the term sheet.
What Does This Mean for Bolt?
The settlement with Activant Capital marks a significant development in Bolt’s history. While it brings an end to one chapter of controversy, the company still faces numerous challenges ahead. The ongoing drama surrounding its attempts to force existing shareholders to buy more shares at an increased valuation threatens to undermine investor confidence and potentially derail the company’s future.
The Impact on Fintech Ecosystem
Bolt’s story serves as a cautionary tale for startups in the fintech space. As companies navigate the complex world of venture capital and private equity, they must be mindful of the potential risks and pitfalls that can arise from contentious relationships with investors.
Related Stories: Inside the Wild Fall and Last-Minute Revival of Bench
The drama surrounding Bolt is reminiscent of another high-profile fintech startup, Bench. In a recent article, TechCrunch revealed the inside story behind Bench’s tumultuous fall and last-minute revival over the holidays. The company’s struggles serve as a reminder that even successful startups can face significant challenges in the ever-changing landscape of fintech.
Fintech Companies Hiring in 2025
As Bolt navigates its current challenges, other fintech companies are preparing for the year ahead. In an article published by TechCrunch, we highlighted some of the top fintech companies hiring in 2025 after a turbulent year. The list includes companies like Stripe, PayPal, and Square, which are all looking to expand their teams as they continue to drive innovation in the industry.
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The world of fintech is constantly evolving, with new developments emerging daily. In our latest coverage, we explore the impact of generative AI funding reaching new heights in 2024 and how it’s shaping the future of finance. We also examine the role of tax automation in the industry, highlighting companies like SafeSend that are pioneering innovative solutions.
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