Backplane, the US-based social networking company affiliated with pop star Lady Gaga and backed by investors including corporate venturing unit GV, has gone out of business and sold its assets, TechCrunch has reported.
Founded in 2011, Backplane provided a service building specialised social networks for fan groups and organisations, its first revolving around a social network for Lady Gaga fans called Little Monsters.
GV, then called Google Ventures, was among the investors in the company’s 2011 seed round, which also included SV Angel, Founders Fund, Menlo Ventures, Tomorrow Ventures and I/O Ventures, and which gave Gaga herself a 20% stake.
The seed investors returned for a $12.1m series A round the following year that valued Backplane at $40m and also included media group Advance Publications, beverage company Coca-Cola, entertainment provider Cirque du Soleil, Sequoia Capital, Greylock Partners, Battery Ventures and Formation 8.
By the time Backplane raised a further $5m in convertible debt in March 2015 however, it was rapidly losing money, with a large burn rate and mismanagement said to be significant problems.
Backplane attempted to cut the burn rate and pivot to concentrate on Place.xyz, a platform that enabled users to build their own networks, but the heavy liquidation preferences included in its initial fundraising put off new investors and the company eventually defaulted on loan obligations to lenders, a source told TechCrunch.
Backplane’s assets have been sold through law firm Dorsey & Whitney, but some of its series A investors are establishing a new company that will essentially relaunch the business, according to Backplane CEO Scott Harrison.
– Photo of Lady Gaga courtesy of Littlemonsters.com