Character.AI Just Filed For Bankruptcy, And Former Foe Disney May Buy It For Parts
Over its short life, the company lost key employees and faced multiple legal challenges.
Character.AI
Character.AI, a controversial generative AI startup that lets users create their own chatbot characters, has filed for Chapter 11 bankruptcy. The company, which lost key talent to Google and had its former CEO hired by Disney, allowed Disney to make the first offer on its assets for $20 million, pending higher offers. Character expects the sale to be completed by early December.
In its blog post, Character said it filed for Chapter 11 protection to facilitate the sale of the company and its assets, listing liabilities of between $50 million and $100 million. As the lead "stalking horse" bidder, Disney would buy certain assets and provide transition support using staff it previously hired from Character.AI. The platform's services will continue, but could be shut down if a buyer isn't found.
Character.AI allows...
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