Failure – AI-driven fintech
When the promise of private equity met legal reality
Ownership isn’t just a promise.
Linqto, founded in 2010 to democratize access to private investments for retail investors, suddenly shuttered in March 2025. An internal review revealed that many clients never actually owned the shares they bought via SPVs, raising red flags with the SEC and FINRA.
In July, the platform filed for Chapter 11 bankruptcy, disclosing approximately $500 million in assets held via LiquidShare and securing $60 million in debtor-in-possession financing to preserve value.
A court in Texas refused to shift the case to Delaware, despite shareholder objections over forum selection. Lawsuits now point fingers at former leadership for misleading customers and mishandling ownership.
Lessons:
– Make ownership structures legally sound and transparent.
– Regulatory boundaries exist for a reason - don’t ignore them.
– Bankruptcy doesn’t erase liabilities - it magnifies oversight.
– When platforms lock out investors, trust dissolves.
Failure is a signal, not a sentence. We learn, we adapt, we rebuild.
— Linqto team (past and present) - thank you for the lesson: clarity and legality come first.
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