In early January, Liberty Lake-based Vega Cloud Inc., a software company that helps organizations manage their cloud spending, was in the late stages of a strategic sale that ultimately failed, leading the company to a workforce stoppage, followed by a petition to place it into receivership, court records filed with the King County Superior Court indicate.

The court filings — including a declaration from Los Angeles-based client Mission Cloud Services Inc., and a March 1 receivership report — suggest the failed sale of the company left Vega Cloud unable to sustain operations. Receivership records show Vega Cloud had $12,000 in its primary checking account when the Jan. 15 receivership order was entered, compared to over $6 million in secured debt, cloud payables, investor notes, and other liabilities.

Kris Bliesner, CEO of Vega Cloud, did not respond to the Journal's requests for comment.

A receivership is a state-court-based legal process in which a neutral third party is appointed to take control of a distressed company’s assets, manage operations, and liquidate or sell the business to pay creditors. It's often used as an alternative to bankruptcy.

In the case of Vega Cloud, the company executed an Assignment for the Benefit of Creditors on Jan. 14, assigning Barry W. Davidson, of Spokane-based law firm DBM Davidson PLLC, as its receiver.

A failed exit

On Jan. 2, court records show Bliesner sent an email to its clients, including Mission Cloud Services, informing them that the company had failed to close a strategic sale, prompting a notice to employees not to report to work the following Monday. 

“You may have heard that Vega Cloud was in the late stages of a potential sale to a strategic buyer. We want to let you know that, unfortunately, this transaction will not be moving forward,” Bliesner’s email to Mission Cloud states. “As we evaluate next steps, we have asked our employees not to report to work beginning Monday, Jan. 5, and until further notice. During this period, our ability to provide support and services may be limited.”

Mission Services had a reseller contract with Vega Cloud in which it marketed and bundled Vega Cloud products as part of its services to Mission Cloud customers. Their contract began in July 2024 and was meant to last five years. Under the reseller agreement, Mission Cloud paid a $50,000 monthly platform fee to Vega Cloud for its services.

Caleb Mills, chief customer service officer for Mission Cloud, states that upon receipt of this notice, he contacted Bliesner, who disclosed that Vega Cloud had terminated all of its employees, leaving the company unable to service Mission Cloud’s needs as outlined by the terms of their contract. 

It's unclear how many employees Vega Cloud had at the time. In September 2022, following the completion of a $9 million funding round, the Journal reported that Vega Cloud employed 30 people, up from 24 earlier in the year.

Mills states that following the termination of Vega Cloud’s employees and the company's entering receivership, the quality of its data deteriorated, with many of its customers requesting concessions and audits, and others leaving Mission Cloud for a different service provider. Mission Cloud requested an immediate severance of its contract with Vega Cloud. 

“The situation is an emergency as the deterioration of Mission Cloud’s business has begun and only the immediate termination of the contract with Vega Cloud and the engagement of an alternative provider will solve the myriad of problems that Vega Cloud has caused with its insolvency and then receivership,” Mills states in a Jan. 30 filing. 

Past growth and financial details from filings

Vega Cloud was launched in April 2020 by Bliesner and five former co-workers of 2nd Watch Inc. At the time, Bliesner told the Journal he believed he and his team had created a “solid fix” for businesses still new to the cloud, yet too busy to manage it on their own. 

Over the years, the company raised several rounds of funding and grew its customer base. As reported by the Journal, in 2020, the company completed a $2.3 million funding round, which included Spokane-based Kick Start Fund and high-profile Seattle-based venture capital firm Voyager Capital. In addition, it received $250,000 in debt financing from Spokane-based Ignite Northwest. 

In 2022, the company completed a $9 million round of funding. Spokane area investors included Kick Start Angel Investment Funds, Cowles Co., and Rudeen & Co.

Court records list contracts, subscriptions, and consulting services with companies including Spokane-based Itron Inc., Paramount Global, Molina Healthcare Inc., and Deloitte Consulting LLP, and others. The contract with Mission Cloud generated $50,000 in monthly revenue, according to court documents filed on Jan. 30. 

According to court records, Vega Cloud entered receivership with more than $6 million in financial obligations. Liabilities include $3.5 million owed to secured lender Sun Mountain Private Credit Fund, nearly $830,000 in cloud-payable obligations to Amazon Web Services, and multiple convertible and subordinated notes issued to investors in 2025.

Additionally, the records list former employees who are owed unpaid commissions, bonuses, and reimbursements. 

The debt amount held by Vega Cloud exceeded its immediately available cash. Receiver records indicate Vega Cloud had $12,000 in its checking account when the Jan. 15 order appointing a receiver was entered. In the weeks that followed, customer payments from enterprise clients and a $100,000 settlement with Mission Cloud boosted the company’s balance.

Court records suggest that while Vega Cloud had several customers and contracts, the failed sale left the company without enough liquidity to continue operating or pay its debts as they became due. Despite this, as of the March 1 receivership report, Vega Cloud was still receiving payments from several of its previous customers, including Hearst Technology Inc., Edelman Financial Engines LLC, and Amazon.com.