Semafor, the media company floated last year has announced its intention to acquire the $10 million FTX stake which belonged to the exchange’s former Chief Executive Officer (CEO) Sam Bankman-Fried.
For now, the company is seeking more funds to augment the capital it has at hand, and at the time of this writing, no investment had been made into the venture.
Justin Smith, one of Semafor’s founders and CEO announced “We are planning to repurchase Sam Bankman-Fried’s interest in Semafor and to place the money into a separate account until the relevant legal authorities provide guidance as to where the money should be returned.”
SBF Was Semafor’s Biggest External Investor
Semafor was launched by The New York Times’s media columnist Ben Smith and Justin B. Smith, the former CEO of Bloomberg Media Group. The media house was backed by several deep investors including Bankman-Fried. However, with the resignation of the young billionaire as well as the several charges against him which he already pleaded not guilty to, Semafor feels jittery.
Before the liquidity crunch faced by FTX, Bankman-Fried invested as much as a third of the $25 million that the media house secured in its initial funding.
Semafor’s plan to acquire SBF’s $10 million stake is targeted towards saving its head seeing that the former CEO was its biggest supporter. Markedly, Semafor joins the list of entities including political parties that claimed that they were going to return funds that they received from FTX and its other associate firms.
Michael McCaffrey, the now-former CEO of crypto media site The Block resigned in December due to his failure to disclose details about the loans he received from SBF through Alameda Research before the liquidity crunch faced by FTX. According to Bobby Moran, the new CEO of The Block, no employee was aware of his transaction between both entities.
“No one at The Block had any knowledge of this financial arrangement besides Mike,” said Moran. “From our own experience, we have seen no evidence that Mike ever sought to improperly influence the newsroom or research teams, particularly in their coverage of SBF, FTX, and Alameda Research.”