Character.AI files for bankruptcy, Disney bids $20 million
Generative AI platform company Character Technologies has filed for bankruptcy protection in the US. Disney has submitted a $20 million bid to acquire certain assets of the company.
Character Technologies, the US-based company behind the generative AI platform Character.AI, has filed for Chapter 11 bankruptcy protection. The company announced on October 12 that it had agreed to sell certain assets to Disney for US$20 million.
The company is seeking court approval for auction procedures that would designate Disney as the "stalking horse" bidder. This sets a baseline offer price for any competing bids.
Court filings indicate that Character Technologies has estimated assets and liabilities in the range of US$50 million to US$100 million. The company intends to continue operating the Character.AI platform during the sale process, with plans to wind it down if no buyer agrees to continue operations.
Led by CEO Colin Adams, the company was previously backed by Andreessen Horowitz. This bankruptcy filing highlights potential financial challenges for AI startups and may influence future consolidation in the sector.