Restraining Orders And Dumbfounded Investors: Ryan Breslow’s $450 Million Bolt Round In Chaos

Forbes

The Bolt founder claimed a group of investors had signed off on the company’s chaotic $450 million raise, but some said they hadn’t. Now, BlackRock and other investors have moved to stall the round.  Read the full story on Forbes: https://www.forbes.com/sites/iainmartin/2024/09/04/restraining-orders-and-dumbfounded-investors-ryan-breslows-450-million-bolt-round-in-chaos/  Subscribe to FORBES: https://www.youtube.com/user/Forbes?sub_confirmation=1  Fuel your success with Forbes. Gain unlimited access to premium journalism, including breaking news, groundbreaking in-depth reported stories, daily digests and more. Plus, members get a front-row seat at members-only events with leading thinkers and doers, access to premium video that can help you get ahead, an ad-light experience, early access to select products including NFT drops and more:  https://account.forbes.com/membership/?utm_source=youtube&utm_medium=display&utm_campaign=growth_non-sub_paid_subscribe_ytdescript  Stay Connected Forbes newsletters: https://newsletters.editorial.forbes.com Forbes on Facebook: http://fb.com/forbes Forbes Video on Twitter: http://www.twitter.com/forbes Forbes Video on Instagram: http://instagram.com/forbes More From Forbes:  http://forbes.com  Forbes covers the intersection of entrepreneurship, wealth, technology, business and lifestyle with a focus on people and success.

Transcript

00:00Today on Forbes, restraining orders and dumbfounded investors, Ryan Breslow's $450 million bolt

00:08round in chaos.

00:11On Monday morning, Bolt founder Ryan Breslow thanked a group of investors for signing a

00:16deal that would reinstall him as CEO of the payments company, which announced plans in

00:21August to raise $450 million at an astronomical $14 billion valuation.

00:29In an email to shareholders, he wrote, quote, I'm so grateful to announce the support of

00:33so many of our key stockholders for the Series F financing round.

00:38The email went on to list, quote, a few investors who have given us permission to share their

00:43names as supporters.

00:45That list included NJF Capital, Stack Capital, Streamlined Capital, Third Base Capital, Stonebridge,

00:54Montauk Ventures, Daniel Fine, Ash Pornori, David Spencer, Oleg Shelzov, Steve Ryan, Mike

01:02Kralivsky, and Bruno Wernick.

01:05For Breslow, whose planned raise and reinstatement as CEO requires the majority approval of preferred

01:11shareholders, lining up endorsements from 13 willing to be publicly named was a proud

01:16moment, were it not for one problem.

01:19Some of them had not actually given their support.

01:23Philip Krim, the founder of Montauk Ventures and mattress startup Casper, told Forbes,

01:28quote, Montauk Ventures has not and does not support the financing.

01:32I'm not sure why Ryan included me.

01:34He did not have my permission, and I do not support this financing.

01:39Pornori, a music producer and executive, was similarly irked.

01:43He said, quote, not sure why my name was circulated in this way, and I have not yet signed anything.

01:50Of the 13 investors named in Breslow's email, only one, Oleg Shelzov, would confirm that

01:56they had signed paperwork.

01:58He told Forbes, quote, I think none can better run a company than its founder.

02:03The other 10 declined to say or did not respond to comment requests.

02:09Breslow's seemingly premature victory lap is the latest cock up in a chaotic series

02:12of errors and misunderstandings that have confused shareholders struggling to make sense

02:17of the unorthodox deal he insists will, quote, lead Bolt back to the path of massive growth.

02:24To recap, just days after announcing the $450 million round, the firm listed as the lead

02:30investor, say Shell-registered investment bank Silver Bear Capital, denied any participation.

02:36Shortly after, a broker assumed responsibility for mistakenly naming them in the deal.

02:42Then the round's other lead investor, the London Fund, clarified that, quote, at no

02:46point have we stated that a transaction has concluded.

02:51Bolt is now threatening legal action against Silver Bear to force its participation in

02:55the round.

02:57The plan hit yet another obstacle on Tuesday, when the world's largest asset manager, Blackrock,

03:02along with Hedda Sophia and Untitled Ventures, applied for a restraining order in Delaware's

03:07Court of the Chancery to halt Bolt's Series F.

03:11Last month, the same group objected to a proposed settlement between Breslow, Bolt, and investor

03:16Activant Capital that would see Activant sell roughly $36 million of its shares back

03:21to the company.

03:23The trio of shareholders claimed their questions about the deal have gone unanswered by Bolt,

03:28and called for the court to pause the fundraise ahead of the Tuesday deadline to sign.

03:33Cliff Gardner of Skadden Arps, attorney for the investors in the court filing, said, quote,

03:38"...the company is coercing its investors by forcing them to choose between paying millions

03:42of dollars for new stock or losing most of their existing investment."

03:47They claim the Series F has not been approved by Bolt's board of directors.

03:52They argued, quote, "...Breslow stands on all sides of the purported deal."

03:56Meanwhile, Bolt's leaders have doubled down on the company's outlook, which is, even if

04:02generous, bleak.

04:03Interim CEO Justin Grooms wrote shareholders last Friday, quote, "...because of the extraordinary

04:09actions taken by management and our board, we now have the opportunity to get everything

04:14back on track and all the firepower we need to see our grandest ambitions through."

04:18Breslow's pitch to Bolt investors to back his return as CEO struck a sour note with

04:24those alarmed by the company's stalled growth, wild spending, and an ultimatum to back the

04:29new round or risk having 70% of their investment wiped out.

04:34Even Bolt's shareholder characterized the deal to Forbes as, quote, "...either bad faith

04:39or extremely delusional, or both."

04:44For full coverage, check out Ian Martin and Sarah Emerson's piece on Forbes.com.

04:50This is Kieran Meadows from Forbes.

04:52Thanks for tuning in.

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