Latest news with #Aspiration
Miami Herald
03-04-2025
- Business
- Miami Herald
Microsoft and Meta partner files Chapter 11 bankruptcy
Large companies such as Microsoft, Amazon, Nvidia, and Meta may seem like powerhouses of efficiency to the common person, seemingly able to accomplish thousands upon thousands of tasks in a day. But look beneath the surface, and you'll see that each mammoth organization has a network of other businesses helping them manage that seemingly impossible list of tasks. This is one of the golden keys to success that keeps said businesses making billions of dollars every year. Don't miss the move: Subscribe to TheStreet's free daily newsletter However, for every big success story, there are many who try to thrive but are unable to. Related: Another popular bank is closing branches (locations revealed) Some cannot secure the funding they need to continue essential projects, while others may be adversely affected by the financial landscape and other key factors. It's a sad story, but unfortunately, it's also a common one in a highly competitive business world. Climate finance firm Aspiration Partners (CTN Holdings), previously backed by Microsoft and Meta, filed for Chapter 11 bankruptcy on March 30. The company seeks to sell its assets to repay debts, which it will do at auction 45 days from the date of the bankruptcy filing. The move comes in the wake of major controversy within Aspiration. One of the company co-founders and its largest shareholder, Joseph Sanberg, 45, was arrested on March 3 on a federal criminal complaint alleging that he conspired to defraud two investor funds of at least $145 million. Sanberg allegedly worked in tandem with 51-year-old Ibrahim Ameen AlHusseini, committing wire fraud and falsifying documents to help Sanberh achieve his goal. Per his plea agreement, AlHusseini made approximately $12.3 million in payments for his actions. He has pled guilty to the claims and is scheduled to be sentenced on September 29, 2025. "Our prosecutors and law enforcement partners have worked methodically to secure a guilty plea from one of the main offenders in this case and have now charged another member of the conspiracy," said Acting United States Attorney Joseph McNally. "We will continue to ensure that markets and businesses receive an honest and level playing field in which to operate." Related: Billionaire Michael Bloomberg sends hard-nosed message on economy The scandal left Aspiration in a compromised position, unable to secure additional funding, despite a statement from The U.S. Department of Justice that "The allegations relate solely to Sanberg's personal conduct and do not implicate CTN or its affiliates." Aspiration's unsecured creditors include the Los Angeles Clippers and Kia Forum, who are owed approximately $40 million linked to contracted carbon credits. Former Microsoft CEO Steve Ballmer owns both. Unfortunately, it may be a while before these creditors see the money they're owed. According to Chief Restructuring Officer Miles Staglik, "Realising value will require substantial investment and patience." The bankruptcy also raises concerns about the voluntary carbon market (VCM), which is currently valued at $933.23 billion. This decentralized market, which allows individuals and organizations to buy and sell carbon credits to offset their greenhouse gas emissions, is of great importance to businesses striving to reach climate action goals. Related: Billionaire Mark Cuban wants to take down TikTok The Arena Media Brands, LLC THESTREET is a registered trademark of TheStreet, Inc.
Forbes
01-04-2025
- Business
- Forbes
Climate Tech Startup With Celebrity And Billionaire Backers Files For Bankruptcy
Steve Ballmer's L.A. Clippers are owed $30 million after climate tech firm CTN declared bankruptcy. AP Photo/Mark J. Terrill CTN Holdings, a San Francisco company focused on selling carbon credits that is an offshoot of digital bank Aspiration, has filed for Chapter 11 bankruptcy protection. CTN has an estimated $170 million in outstanding debt, according to court filings, and an accumulated net operating loss of $580 million for federal tax purposes. Founded in 2013 by entrepreneurs Andrei Cherney and Joe Sanberg, Aspiration began as an environmentally friendly digital bank that offered consumer bank accounts and green investment options. It reached a peak valuation of $2.3 billion in 2021 and was backed by high-profile investors including billionaire Steve Ballmer, Leonardo DiCaprio and Drake. As growth for its digital bank slowed, the company largely shifted its focus to selling carbon credits to other businesses, a strange pivot Forbes covered in 2023. The basic idea of carbon credits: Any company can mitigate the damage its business does to the environment by funding initiatives that will remove carbon from the atmosphere, such as planting trees. Among Aspiration's most prominent carbon-credits customers were the L.A. Clippers (owned by Steve Ballmer) and Meta. Earlier this year, CTN was still receiving funding from entities affiliated with cofounder Joe Sanberg. But Sanberg was arrested in early March 2025 on a criminal complaint alleging he conspired to defraud investors of at least $145 million in connection with two personal loans he took out against his shares in CTN. The investors affiliated with Sanberg stopped providing funding to CTN in February 2025, and then CTN had trouble finding sufficient funding to keep the business afloat, according to bankruptcy filings. The charges against Sanberg relate only to his personal conduct; CTN isn't implicated, according to a court filing. Sanberg's lawyer Mike Mukasey told us in a statement: 'Mr. Sanberg has pleaded not guilty to the charges. We will buckle down and defend him with vigor and zeal.' CTN aims to auction its assets over the next 45 days to repay creditors. Its executives were unaware of Sanberg's alleged misconduct, according to a court filing from Miles Staglik, a managing director at turnaround firm CR3 Partners who is now chief restructuring officer of CTN. Staglik also wrote that Sanberg 'no longer holds any positions or roles' with CTN and 'is no longer involved in any capacity' with its operations. CTN's largest creditors are the L.A. Clippers (owed $30 million) and Forum Entertainment (owed $11 million), both of which Steve Ballmer owns. Other creditors include the Boston Red Sox (owed $5 million), fintech fraud prevention companies Socure ($4 million) and Feedzai ($930,000) and consulting company Slalom ($2.6 million). Bloomberg earlier reported the news of CTN's bankruptcy. In April 2024, Mission Financial Partners, which was incorporated in November 2023, acquired the Aspiration digital banking brand in a licensing spinoff. 'Aspiration is not affiliated with CTN Holdings, and Aspiration's family of green financial products are unaffected by this filing or any related legal matters,' says a Mission Financial Partners spokesperson.
