- This year, Cameo has slashed its valuation from US$1 billion to less than US$100 million
- The company’s financial health is so “dire” that it cannot even pay its US$600,000 Federal Trade Commission fine for violating celebrity endorsement regulations.
- Should it file for bankruptcy within the next 91 days, Cameo will also be required to foot the entire bill.
Once upon a time, Cameo was the poster child for pandemic-era capitalism where cult personalities, niche actors, and what few A-listers it attracted alike could make their fortune. Now, the personalised video message platform finds itself in a less-than-ideal situation.
Buoyed by a tide of post-coronavirus optimism, the former tech unicorn achieved a billion-dollar valuation circa 2021 thanks to US$100 million in Series C funding; pocketing investments from the likes of SoftBank Vision Fund 2, Google Ventures, UTA, and Amazon’s Alexa Fund.
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But since then, it hasn’t exactly been smooth sailing. Among its challenges were failing to bolster its talent roster with enough names people cared about, several sizeable layoffs in 2022 and 2023, and failing to scale up in any meaningful fashion, all while taking a 25% clip from the creators actually making the content.
In March 2024, a US$28 million investment round led by Valour Equity Partners was authorised, drastically reducing its lofty three-comma price tag by approximately 90%. The new figure? Less than US$100 million. But what seemed close to rock bottom for a quickly dying fad clearly had a basement.
As reported by Business Insider, it’s gotten to the point where Cameo cannot even pay its US$600,000 Federal Trade Commission fine for violating the governing body’s regulations surrounding celebrity product endorsement.
Instead, the 30 states involved have settled for an almost negligible total of US$100,000 between them. As per the settlement agreement:
“Due to Cameo’s inability to pay $600,000, as demonstrated by Cameo’s 2021 and 2022 audited financial statements, and additional representations made about Cameo’s financial status in October 2023, the Settling States and Cameo agree and stipulate that upon receipt of $100,000 from Cameo, the Settling States shall suspend the remaining amount due.”
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Should it fail to pay this US$100,000 within the next three years, the aforementioned 30 states will be permitted to go after Cameo for the full US$600,000 plus interest; Cameo would also be responsible for footing the entire bill if it files for bankruptcy within 91 days.
Outside of the dollar figure, Cameo has been ordered to implement features such as watermarks and a reporting system; enforce acknowledgement of the endorsement regulations by celebrities/brands; as well as being tasked with monitoring for non-compliance.
The candles that burn twice as bright also burn half as long, I suppose.
