Neverblues Parent Company Files for Bankruptcy

On Monday news came that Neverblue’s, a major player in the CPA space, holding company (Velo) filed for bankruptcy.

The nasdaq article which broke the news stated that it was forced into bankruptcy for doing some sketchy stuff:

Online marketing and sales company Velo (Neverblue’s holding company) filed for Chapter 11 bankruptcy Monday amid demands from Visa Inc. (V) and its credit-card processor after the passage of a federal law quelling aggressive online marketing practices caused revenue to plummet.

As you read more into it you see the company states that it has over $1 Billion dollars in Debt!!

As you can imagine, fearing major backlash, Neverblue reached out to all the authorities in the space (how I heard about it originally) with the following statement:

This filing will not impact Neverblue’s ability to meet client needs in any way – we intend to continue to operate business as usual without interruption. Neverblue’s business is fundamentally strong and we intend to make all payments on schedule, in a timely and reliable manner.  We’ve built out our global, performance-based online marketing strategy across several unique verticals, and now operate one of the largest international cost per action networks.  Neverblue is absolutely well-positioned for future growth as one of the most highly-valued lead generation companies.

Obviously, the first question on the minds of  thousands of Neverblue’s affiliates is – “Am I gonna get paid?”

Well it seems like what is going on is Neverblue or one of its holding companies were making a ton of money from doing stuff that is now outlawed.  While these are not defined you can guess from recent FTC guidelines what they were doing.

My impression is they had a knee jerk reaction to all the recent FTC suits against CPA Networks and immediately pulled back from doing all the free+trial offers, deceptive make money online offers, and the way they or their affiliates were marketing these items.

A lot of those offers got nailed and could not pay Neverblue’s holding company,  which left the holding company (Velo)  in a debt over a billion dollars. Again, wow at that billion dollar mark.

So, now the tax payers will eat the billion dollars while Neverblue’s holding company tries to move forward.

I wish them the best of luck.  The CPA space is having a really tough time and personally I think it will be hard for them to rally.

Edit: In a comment below Leanne Lowe gave further clarificaiton on how this will effect Neverblue specifically

Neveblue Operates Business as Usual

Neverblue’s parent company, V2V Holdings LLC and its U.S. subsidiaries, today filed for voluntary protection under Chapter 11 of the U.S. Bankruptcy Code. Neverblue was not included in this filing. V2V intends to use the Chapter 11 to restructure its balance sheet and ensure the long term financial health of key businesses.

This filing will not impact Neverblue’s ability to meet client needs in any way – we intend to continue to operate business as usual without interruption. Neverblue’s business is fundamentally strong and we intend to make all affiliate payments on schedule, in a timely and reliable manner. We’ve built out our global, performance-based online marketing strategy across several unique verticals, and now operate one of the largest international cost per action networks. Neverblue is absolutely well-positioned for future growth as one of the most highly-valued lead generation companies.

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