Ryan Breslow, co-founder of e-commerce software company Bolt, was subpoenaed by the U.S. Securities and Exchange Commission last year along with his company. The Information first reported the news on Friday.
In a letter written in April by lawyers representing Bolt’s investors, the SEC was investigating whether Mr. The letter was sent to Bolt’s general counsel as part of a request to examine the company’s records on behalf of two of Bolt’s investors, WestCap Management’s Brian Reinken and Tribe Capital Management’s Arjun Sethi, Series C and B investors, respectively.
Breslow allegedly “misled” investors during the company’s fundraising, according to a letter referenced by The Information. $355 million Series E round, the company is valued at $11 billion. Lawyers representing Westcap and Tribe Capital wrote that Breslow “substantially misrepresented our financial position and product pipeline, resulting in Series E investors acquiring us at a significantly inflated valuation.”
Shortly after announcing its Series E funding in January 2022, Breslow said: Comments he made about competitors and investors, and eventually resigned as CEO of Bolt. very soon, He launched a wellness marketplace called Love According to his LinkedIn profile, he founded in January 2022.
Asked about the subpoena and lawsuit, an SEC spokesperson told TechCrunch that the agency “does not comment on possible investigations.”
In another case, lawsuits filed this week A lawsuit against Breslow by former director Steve Saracino of Activant Ventures alleges Breslow was fired after he and two other directors refused to help pay back a $30 million loan to Breslow. Sarasino’s lawsuit also alleges that CEO Maju Kuruvila and three subsequently appointed directors did not coerce Breslow to repay the loan.
When asked for comment, Mr. Breslow did not respond personally, but summoned a Bolt spokesperson to confirm the lawsuit over the loan, writing in an email: The Company continues to be well capitalized and the existence of this outstanding obligation to the Company has not and will not affect the day-to-day operations or prospects of the Company. ”
When Bolt announced its Series E funding, the company was a hot commodity.
Breslow told TechCrunch at the time about the $355 million funding round: We want to be not just on par with our competitors, but better. This capital will allow us to bring in top talent, make strategic acquisitions and expand our significant European presence. ”
Bolt had no problem raising a lot of money at the time, but Breslow made it public early on that he was having trouble attracting Silicon Valley investors.It was right after Series E that he started Share your thoughts on Twitter.
Shortly thereafter, he resigned as CEO, claiming his resignation had nothing to do with his tweets gaining attention.
What followed soon seemed to be a roller coaster ride for Bolt.the company is sued by one of our largest customers May 2022 (the incident was resolved after a few months). the next day, reported by TechCrunch A blog post written by CEO Maju Kuravilla revealed a 131% year-over-year increase in shopper accounts and a 192% year-over-year increase in the total number of active seller accounts.
Only a few weeks later, Bolt lays off more than 100 people Kuruvila attributed the restructuring move to changing market conditions, again in a blog post, writing: To ensure that Bolt takes his own destiny into his own hands, management and I have made the decision to secure our financial position, extend our runway, and achieve profitability with the funds we have already raised. ”
Following Series E, The New York Times reported Bolt’s leadership has initiated new talks with investors to secure additional capital at a higher valuation of $14 billion. But that hasn’t happened yet.
