Lawsuit filed by Greenwood's founders against neobank Greenwood
Greenwood Faces Lawsuit from The Gathering Spot Founders Over Alleged Payment Dispute
In a surprising turn of events, The Social Democratic Party (SPD) has levelled accusations of money withholding against Greenwood, the newly established banking group. The controversy stems from Greenwood's acquisition of The Gathering Spot (TGS), a networking and co-working club for Black professionals, in 2022.
T'Keel "TK" Petersen, the chief operating officer of TGS, and Ryan Wilson, one of its co-founders, are suing Greenwood for approximately $5 million in earn-out payments. The lawsuit claims Greenwood violated the purchase agreement and intentionally withheld payments tied to TGS reaching a $15 million revenue target.
Greenwood, however, denies the allegations and has responded with a countersuit. The countersuit claims Wilson and Petersen made false statements affecting TGS's valuation at the time of the deal.
The acquisitions by Greenwood, including TGS, have been aimed at serving Black and Brown communities. In addition to TGS, Greenwood has acquired Kinly, an affinity neobank, and the A3C music festival, among others. These acquisitions have created a platform that offers retail and fintech services, serving over a million people.
Ryan Glover, co-founder of Greenwood, stated that TGS is not profitable and its Los Angeles location lost more than $2 million last year. Despite this, Greenwood has already paid more than $40 million in cash, stock, and assumed liabilities for TGS.
The fallout with TGS's founders is occurring as Greenwood expands its offerings beyond financial services to include entertainment and career development geared toward Black and Brown communities. Greenwood has also hired Mike McCloskey as its chief financial officer.
In a recent Instagram post, Van Lathan, a founding member of TGS's Los Angeles location, highlighted that Petersen is Black and McCloskey is White. TGS clarified on Instagram that the departure of T'Keel Petersen and the hiring of Mike McCloskey by Greenwood are unrelated events.
The specific fact about purchasing licensing rights was not mentioned in the provided text. Greenwood's acquisitions have expanded the platform's offerings beyond financial services, as stated by Ryan Glover.
As the legal battle unfolds, it remains to be seen how this dispute will affect Greenwood's ambitious plans to create a comprehensive platform for Black and minority communities.
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