Payment unicorn Bolt Financial shocked investors with its announcement of a $450 million fundraising round at a $14 billion valuation, but confusion arose when the main investor named, Silverbear Capital, denied involvement. CEO Justin Grooms threatened legal action against the investment bank, stating they had signed a binding term sheet committing $200 million. Silverbear Capital founder Peter Chun expressed surprise at the situation, claiming they had never been in discussions with Bolt and were not part of the deal.
Documents viewed by Forbes indicated that Silverbear and partner Brad Pamnani were leading the deal, but Chun clarified that Pamnani did not have authority to make such agreements. Pamnani, who claims to manage a $6.7 billion portfolio, stated that the confusion arose from a broker mistakenly naming Silverbear as the lead investor. He signed a non-disclosure agreement using his Silverbear email address, leading to further confusion. The broker, AMA Investment Group, took responsibility for the error and promised to rectify the situation.
Grooms sent an email to shareholders informing them of ongoing discussions with lead investors and promised an update on a new timeline and updated materials. Pamnani claimed that a fund based in Abu Dhabi was leading the round, but did not provide further details or confirm government approval for registration in the UAE. Grooms insisted that Bolt would hold investors accountable for their commitments, even if Silverbear or their associates do not fulfill their pledge.
In another update, Grooms adjusted the terms of Bolt’s Series F round, extending the deadline for investors to commit and reducing the pro-rata pool by $20 million. He also reiterated the company’s plan to raise $250 million in “marketing credits” from The London Fund, despite concerns about the fund’s credibility. Bolt’s financial statements revealed losses of $302 million in 2023 on revenues of $27 million, with a significant goodwill impairment contributing to the poor performance. Despite multiple rounds of layoffs, revenues had also decreased from the previous year.
Investors in Bolt Financial are facing uncertainty and confusion as the company navigates its fundraising round and addresses the discrepancies with the supposed lead investor, Silverbear Capital. Grooms and Pamnani have provided conflicting accounts of the situation, with Grooms emphasizing the company’s commitment to holding investors accountable and continuing with the fundraising process. The future of Bolt Financial remains uncertain as it strives to resolve the issues surrounding its latest fundraising efforts and financial performance.
