Greenwood acquired the private nationwide networking hub and workspace for Black professionals The Gathering Spot in 2022 but the financial terms for this deal were not disclosed at the time. However, recent information sourced from court hearings indicates that Greenwood paid USD 50 million for the acquisition. Since then, both companies have been involved in lawsuits, and several Gathering Spot members have taken to social media to express their unhappiness.
Earlier in 2023, the co-founders of TGS sued Greenwood and accused the Atlanta-based fintech company of failing to meet several agreed-upon payments. Specifically, the co-founders are looking to obtain USD 5 million in earn-out payments.
Greenwood’s reply was to file a countersuit based on TGS misrepresenting their finances, which created difficulties after the acquisition. Company representatives cited by altfi.com clarified that TGS is not a profitable business and that its Los Angeles location lost more than USD 2 million last year. Moreover, they revealed that Greenwood has paid out more than USD 40 million in cash, stock and assumed liabilities to date.
Greenwood was founded in 2020 and represents a digital banking platform designed for Black and Latino customers. According to banks.com, Greenwood is technically not a bank but a technology company, which is why its FDIC-insured partner banks provide its banking services.
As the first Black-owned financial institution and neobank, Greenwood was founded with the goal of tackling some discriminatory banking industry practices that Black and Latino individuals face. The company also expressed its goals of fighting the lack of fairness in the financial system towards these communities while helping underserved people in the Latino and Black communities.
Greenwood was designed to offer full-service online banking services through its digital banking platform. Specifically, Greenwood offers spending and savings accounts that are FDIC-insured as deposits are held and managed by a minority-owned partner bank, a member of the FDIC.
Bank accounts opened through Greenwood don’t have any hidden fees such as monthly maintenance fees or overdraft fees, and there is no minimum deposit to open a bank account. Users can also add their Greenwood Debit Card to the Greenwood Gives Back Program, which uses change from debit card round-ups to donate to various organisations such as NAACP or UNCF.
In March 2021, Greenwood raised USD 40 million from a host of US financial institutions, including Truist Financial, JPMorgan Chase & Co, Bank of America, Wells Fargo, and Citigroup. PNC Financial Services Group, Mastercard, Visa, FIS, Banco Popular, as well as several venture capital firms such as SoftBank’s Opportunity Fund also participated in the round.
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