FTX bankruptcy hits Bay Area venture capital firms – and the Warriors, Steph Curry and UC Berkeley

FTX bankruptcy hits Bay Area venture capital firms – and the Warriors, Steph Curry and UC Berkeley

FTX founder Sam Bankman-Fried, a Bay Area native and son of two Stanford professors, resigned as CEO on Friday as the company filed for bankruptcy. His net worth was all but wiped out after peaking at $26 billion earlier this year.

Venerable venture capital firm Sequoia Capital
told sponsors on Wednesday
that he considered his approximately $210 million FTX investment in two funds now worthless “based on our current understanding.” The Menlo Park firm said FTX represented less than 3% of the capital of its Global Growth Fund III, which earned $7.5 billion, and less than 1% of its SCGE fund. Sequoia also removed a glowing profile of Bankman-Fried from its website this week.

San Francisco venture capital firm Paradigm, which focuses on cryptocurrency, invested $278 million in FTX and also expects the entire amount to be lost, according to Axios.

Other significant investors include the Ontario Teachers’ Pension Plan, Tiger Global Management and Softbank.

In an unusual arrangement, Bankman-Fried also reportedly invested more than $500 million in the funds of venture capital firms, including at Sequoia and Paradigm, News reported.

FTX has also spent billions on sports sponsorships and marketing, including with major Bay Area teams.

Sam Bankman-Fried, CEO of FTX, testifies at a hearing before the House Financial Services Committee in 2021.

Sam Bankman-Fried, CEO of FTX, testifies at a hearing before the House Financial Services Committee in 2021.

Alex Wong, HO/TNS

The Golden State Warriors and the US division of FTX teamed up last year to sell non-fungible tokens, the digital collectibles the team previously used to commemorate championships. As part of the agreement, the FTX logo also appears during games hosted by the Santa Cruz Warriors, the NBA team’s G League affiliate.

The Warriors declined to comment.

Warriors star Steph Curry became an FTX ambassador last year, promoting the company in ads in exchange for payment and an undisclosed stake. In a video ad released earlier this year, Curry pointed to his own unfamiliarity with crypto and claimed that FTX was a safe way to invest in the space.

“I’m not an expert, and I don’t need to be. With FTX, I have everything I need to securely buy, sell, and trade crypto,” he said in the video.

Last year, FTX signed a $17.5 million sponsorship deal with UC Berkeley for naming rights to California Memorial Stadium, with the money to be paid in bitcoins. The venue is now FTX Field at California Memorial Stadium.

UC Berkeley officials did not immediately respond to requests for comment on the status of the sponsorship.

UC Berkeley's California Memorial Stadium has renamed its home ground FTX Field, after a partnership with the cryptocurrency exchange.

UC Berkeley’s California Memorial Stadium has renamed its home ground FTX Field, after a partnership with the cryptocurrency exchange.

Staff member Justin Sullivan/Getty Images

Other top athletes have signed with FTX. Football legend Tom Brady and tennis Olympian Naomi Osaki are also ambassadors. And in 2021, the home of the Miami Heat was renamed FTX Arena in a $135 million deal.


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