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Key Takeaways Selena Gomez launched mental health startup Wondermind in 2021 with the intention of focusing on mindfulness and “mental fitness.”
Now, investors are accusing her of fraud after the startup reportedly faced setbacks last year.
The investors are reportedly seeking to recover nearly $1.2 million, along with damages and legal costs.
Selena Gomez faces allegations of fraud from investors in Wondermind, the mental health startup she co-founded, after the company reportedly faced setbacks last year, including layoffs and missed payrolls.
A group of investors in Wondermind filed a lawsuit this week accusing Gomez of failing to follow through on commitments that persuaded them to back the business. They also name Gomez’s mother, Mandy Teefey, and business partner Daniella Pierson, founder of pop culture newsletter Newsette, as defendants in the case.
According to the complaint, which the investors filed on Thursday in Delaware District Court, the plaintiffs expected that Gomez would use her enormous public profile and social media reach to help market Wondermind. Gomez is the most-followed woman on Instagram, with about 404 million followers. She has an audience of 58.7 million followers on TikTok.
The investors believed that Gomez’s social media platforms would give the young company an immediate marketing advantage and a direct line to a highly engaged audience.
They argue that Gomez’s role was central to Wondermind’s appeal. Investors said they understood that much of the startup’s early value rested on her involvement, particularly her ability to promote its mental-health content and future products to followers who already trusted and paid attention to her.
They also allege that Wondermind positioned itself as a mental wellness platform that was exploring products like a “groundbreaking” mobile app. They allege that the company ultimately failed to deliver the products and revenue it had projected.
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