Figure AI cease-and-desist letters have been sent to at least two brokers operating in the secondary markets, according to sources who spoke with TechCrunch. The crackdown comes shortly after the company, known for its humanoid robotics work, gained viral attention for being “the most sought-after private stock” in the market, as described by its founder, Brett Adcock.
Brokers Told to Halt Marketing of Figure Stock
The letters arrived just after Bloomberg reported in February that Figure AI is raising a new funding round targeting a staggering $39.5 billion valuation — a fifteenfold jump from its $2.6 billion valuation earlier in 2024. The brokers affected say Figure’s legal team demanded an immediate stop to the marketing and listing of its shares without board approval.
“We do not allow secondary market trading in our shares without board authorization,” said a Figure spokesperson. “The company will continue to protect itself against unwanted third-party brokers in the market.”
Secondary Market Sales Stir Controversy
Because Figure AI is a private company, its shares are not freely tradable like public equities. This restriction has given rise to secondary markets that offer liquidity options for early investors. These markets facilitate indirect share sales or loans against equity, allowing investors to unlock capital ahead of an IPO.
However, brokers told TechCrunch that Figure’s recent legal moves may have another motive: stopping secondary sales at prices below the anticipated $39.5 billion valuation, which could undercut momentum in its primary fundraising round.
CEO Perspectives Split on Secondary Trading Impact
Sim Desai, CEO of the secondary shares platform Hiive, said that startups sometimes view secondary markets as a threat to their fundraising optics.
“Some CEOs see it as a zero-sum game,” Desai explained. “But active secondary trading can actually attract more primary investors. If something isn’t selling, it’s more about the price than the presence of capital.”
In other words, if existing shareholders are trying to sell their stock at lower valuations, it may reflect a disconnect between perceived and real investor appetite — a potentially uncomfortable signal for leadership.
Tensions Rise Alongside Media Scrutiny
The controversy around Figure AI cease-and-desist letters is not the only friction the company is facing. Figure has recently been in the news for its work with major automotive client BMW, but the company has pushed back on some media coverage, even threatening to sue over reporting it claims is factually incorrect.
Despite the PR turbulence, interest in Figure AI continues to surge, fueled by excitement around robotics, AI, and its bold valuation goals. Whether the company hits its $39.5 billion mark — and how it navigates investor liquidity — remains to be seen.
Get the Latest AI News on AI Content Minds Blog