How the F*ck Could Foursquare Be Sold for $0?!?!?
Foursquare raised $412M and sold to Infillion for $0 to every shareholder. Here's how debt and liquidation preferences zeroed out preferred and common.
Foursquare, a once-valued startup, sold for $0 to ad tech company Infillion, leaving shareholders with nothing. The $412 million raised by the company, including $150 million in a 2019 deal led by Raine Group, was eaten by debt, deal costs, and team payouts before reaching shareholders. The deal, known as Project Frodo, added roughly 20% to 25% to Infillion's revenue and headcount, with most of Foursquare's employees joining Infillion's existing staff.
The sale's secrecy lasted a week before details emerged in a 125-page PDF of deal paperwork. Founders and common shareholders received $0, while Infillion acquired the entire company, adding value to its existing business.
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