Impact of bankrupt crypto exchange FTX is affecting Hollywood.
Not only have the tens of millions of dollars FTX spent on advertising gone up in smoke (don’t expect this year’s Super Bowl to have the crypto enthusiasm that swept last year’s broadcast), but a new bankruptcy filing shows that a Crowd of high profile people and companies likely to lose millions in bankruptcy proceedings.
Among those of interest to Hollywood is Endeavor, the owner of UFC and WME, who owned more than 38,000 shares in FTX through its IMG subsidiary, according to a list of FTX shareholders filed in the bankruptcy filing. The shares, which were Series B preferred stock, suggest that IMG invested in FTX during its 2021 funding round that valued the company at $18 billion.
It’s not immediately clear how much IMG invested in FTX (the company wasn’t mentioned in the Series B funding round’s press release, suggesting it was a small investor), but that investment is likely worthless now.
IMG may have been inspired by FTX’s aggressive sports sponsorship deals, which inked deals with a variety of athletes, arenas, and even leagues (Major League Baseball umpires wore FTX patches on their uniforms last season).
Without a doubt, FTX’s two most prominent celebrity endorsers were NFL star Tom Brady and his then-wife, supermodel Gisele Bundchen (the couple have since announced a split). According to the list of shareholders, Brady owned more than 1.1 million shares of FTX, while Bundchen owned nearly 700,000.
And New England Patriots owner Robert Kraft, who chairs the NFL’s Broadcasting Committee (which negotiates the league’s lucrative TV rights deals), owned nearly 600,000 shares of FTX and another 45,000 shares of the company’s US subsidiary.
And then there’s Kevin O’Leary, the star of ABC’s Shark Tank, who owned more than 32,000 shares of FTX and more than 110,000 shares of FTX US. O’Leary told the US Senate Banking Committee last month that the shares he owned in FTX were worth about $1 million, but he told the committee, “I wrote them down to zero.”
Using that rating, Brady and Bundchen’s share was probably in the 8-figure range.
Perhaps more importantly, O’Leary said his total compensation from FTX was $18 million, including about $10 million in crypto he held on the platform that is now in limbo. If Brady, Bundchen and other endorsers land similar-sized deals, they could face nine-figure wipeouts.