Bolt seeks up to $27M in bridge funding with 'pay-to-play' provision

Bridge Funding Initiative

Bolt, a checkout processing startup, is seeking to raise up to $27 million in a bridge funding round. This financing is structured as a convertible note, which will convert into equity at a discount upon the closing of a future funding round. The round includes a 'pay-to-play' provision, meaning investors who do not participate will lose a portion of their existing equity.

Company Background and Valuation Changes

Founded in 2014, Bolt achieved an $11 billion valuation in early 2022. However, its valuation has since decreased by 97% to $300 million. Ryan Breslow, the company's co-founder, returned as CEO last year after previous legal disputes and investor clashes.

Purpose of the Funding

According to a company press release, the bridge financing will allow Bolt to capitalize on recent operational milestones, clear legacy obligations, and facilitate a transition towards closing a full Series E2 round. Breslow did not specify the nature of these legacy obligations. Bridge rounds are typically used to sustain a company until its next major fundraise or to provide time for restructuring and achieving profitability.

CEO's Commitment

Ryan Breslow is personally committing $5 million to this funding round. He estimates that participation from Bolt's approximately 100 investors will total at least $15 million, though not all investors are expected to join. Breslow claims the company is nearing profitability and returning to growth after a period of shrinking revenue, though he did not disclose current cash reserves.