Character.AI files for Chapter 11 bankruptcy; Disney offers $20 million for its assets
Prepared by Sintelligent with the help of SI. Published in SI: . Updated: .
One of the best-known SI companions may disappear: costs and lawsuits proved heavier than audience growth.
The maker of one of the largest apps for chatting with SI characters has asked a bankruptcy court in Delaware for protection from creditors, calling the platform "costly to develop and grow" and citing possible litigation liabilities and regulatory engagement. According to TechCrunch, assets and liabilities are estimated at $50-100 million, the company raised more than $193 million, and its audience peaked at 20 million monthly active users (October 2024). Disney, the outlet reports, is offering $20 million for the assets and a perpetual non-exclusive license to the technology; the sale is expected by late November or early December. CEO Colin Adams said the platform will be wound down if no buyer emerges. In January the state of Kentucky filed a lawsuit alleging the platform "preyed on children and led them into self-harm"; the company's position on that suit was not found in the sources checked.
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