Gaming startup Gigantic requests court freeze after amassing $10.7M debt
Gaming startup Gigantic requests court freeze after amassing $10.7M debt
The Israeli gaming company, known for the Clawee app, seeks a court-appointed trustee after struggling to raise funds amid mounting financial challenges.
Gaming company Gigantic has submitted a request to the Central Region District Court in Israel for a freeze on proceedings and the appointment of a temporary trustee, aiming to rehabilitate the company, which has accumulated debts of approximately NIS 39 million (approximately $10.7 million). Judge Hanna Kitsis has requested a response from the insolvency commissioner.
Gigantic, founded in 2017 by CEO Ron Brightman and Oded Frommer, developed an application called Clawee, which allows users to control live video feeds from 550 crane machines located in its Petah Tikva offices, offering players the chance to win prizes delivered to their doorsteps. The company's first game, Clawee, reached the top 30 most downloaded games in the U.S., and was also one of the top 100 grossing games.
Over the years, the company raised approximately $19 million, with investors including MoreTech Ventures, VGames, and NFX. At its peak, Gigantic employed over 120 people, including development teams in Israel and Ukraine. However, after recent cutbacks, the company now employs only 16 people.
In its request to freeze proceedings, the company claims that the ongoing war has made fundraising significantly more difficult. Gigantic is seeking the appointment of a trustee to maintain the company as a going concern with a limited scope of activity in order to secure an investment or complete a sale transaction, while also collecting the funds owed to the company.
The application reveals that the company's main debt of approximately NIS 34 million is owed to the secured creditor, Bank Hapoalim. Additionally, the company owes around NIS 730,000 to employees and approximately NIS 4.5 million to suppliers and service providers.
