When Chris Gray sold his Shark Tank-backed scholarship search startup Scholly to Sallie Mae in 2023, he thought he had it all. Now he’s suing the student loan giant for wrongful termination and alleging that it’s selling the data his app collected, which includes personal info on minors, without properly informing users.
Gray co-founded the company a decade prior with the hope of helping students more easily find college scholarships that were going untapped. Within two years, he nabbed sharks Daymond John and Lori Greiner as investors after an appearance on the show.
With the acquisition, Gray became one of the few Black venture-backed fintech founders to exit their company, despite receiving some blowback that he was “selling out.” “I think being one of the first Black tech companies to get acquired by a bank, that’s really a big achievement,” he said at the time.
He took a vice president role at Sallie Mae and expected to settle in nicely at his new gig, while helping scale Scholly and making it free to use, he said in an exclusive interview with TechCrunch.
What happened next is detailed in Gray’s lawsuit against Sallie Mae in Delaware Superior Court, and in a whistleblower complaint he submitted to the Securities and Exchange Commission, both of which he filed earlier this month.
He alleges Sallie Mae laid off his employees, including his co-founders, and then went back on promises that it wouldn’t sell the users’ data, according to a TechCrunch review of both filings. He claims the company fired him a year after the acquisition when he tried to raise concerns about data privacy issues. Gray is seeking backpay and punitive damages in the suit, plus legal costs.
Gray told TechCrunch that before he agreed to the sale, he believed Sallie Mae would be prohibited from disclosing or selling non-public personal information about Scholly customers to third parties because it was a federally regulated financial institution.
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