Please correct me if I'm wrong, but my understanding is that most funds are only allowed to invest capital once, so any of the $40M they get back (which I'd hope would be a somewhat large chunk) can no longer be invested.
A smarter move may be looking at and pursuing several pivots, use that 40M to create a few startups within a startup and see if you can get something started that will provide a healthy return.
Exactly, although they have a tarnished brand. They could find the most talented developer and become somewhat of a Mobile incubator. They've got a lot of deals and scale having dealt with Verizon, physical space and employees. They could use Color labs as the shell for lots of products.