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Sam Bankman-Fried contributed to a $25 million funding round for Semafor. Now the news outlet plans to give the money back.

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sam bankman fried courtSam Bankman-Fried

REUTERS/Andrew Kelly

  • Sam Bankman-Fried invested an undisclosed amount in media startup Semafor’s $25 million funding round last year. 
  • Now Semafor intends to “redeem” the investment, by giving it back, TheWrap reported.
  • The buzzy startup launched just three months ago, and its CEO said Bankman-Fried never held editorial influence.

Semafor, the buzzy media startup that launched three months ago, received an investment from FTX founder Sam Bankman-Fried last year as part of a $25 million funding round, but now plans to give it back, TheWrap reported Tuesday.

Semafor did not disclose the total amount, but a source told TheWrap it “intends to redeem the investment.”

In a separate statement issued to TheWrap, Semafor said, “We are actively working with the relevant legal and governmental bodies who are managing this situation and are following their guidance on the most appropriate next steps to ensure the most ethical and responsible outcome for Sam Bankman-Fried’s creditors and the judicial process underway.”

Semafor wasn’t the only news outlet that accepted funds from the fallen crypto king, who this week pleaded not guilty to fraud charges.

ProPublica, the investigative non-profit, said last month that it will return the $1.6 million it received in what was supposed to be a three-year, $5 million grant from Bankman-Fried.

But some commentators have taken note of Semafor’s lack of clarity surrounding the funds. Elon Musk, for example, posed the question via Twitter at editor-in-chief Ben Smith, a former New York Times columnist, in November, and accused the outlet of having a conflict of interest. 

—Elon Musk (@elonmusk) November 23, 2022

 

In December, CEO Justin Smith, the former chief of Bloomberg Media Group, tweeted screenshots of an internal memo that said the company would await guidance from its legal counsel before finalizing a decision regarding Bankman-Fried’s investments. 

—Justin B. Smith (@Justin_B_Smith) December 2, 2022

 

 

Read the original article on Business Insider

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