erin griffith
@eringriffith
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New York Times reporter // Startups and VC 🦄 Writing a book about the startups in the ZIRP era🦄
Joined September 2008
Reading about white collar crime in the new yorker and this detail is just perfect
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A startup called ON Platform, once known as GameOn, raised $80m in funding from investors including celebs like Snoop Dogg and Joe Montana. Today its founder, Alexander Beckman, and his wife, Valerie Lau, were arrested for fraud. Some of the craziest details from the.
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some Robinhood staff were unhappy about the trading halt. so Robinhood gives them a $40 DoorDash credit? 👀
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2010: founder of startup with big exit ➡️ VC.2011: techcrunch blogger ➡️ VC.2014: c-suite at startup with ok exit ➡️ VC.2019: stripe engineer ➡️ VC.2020: VC podcast ➡️ VC.2021: VC meme account ➡️ VC.
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just learned about a wild legal fight between a VC firm and startup: . 1. Startup is fundraising, VC firm sends unsolicited term sheet. 2. Startup says sorry, the round is oversubscribed. 3. VC wires the money anyway. 4. Startup returns it. (cont ⤵️).
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Crazy lawsuit from an investor - Softbank - against a startup - IRL. Softbank invested $150m in 2021 ($25m went to insiders) on the claim that IRL had 12m monthly users. But the company was spending 50k a month on a bot army and the app was "a virtual ghost town."
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12 million people attended a virtual travis scott concert in Fortnite.
"probably the biggest room that has ever been assembled online," says David Sacks of this new Twitter Space with Ron DeStantis and Elon Musk (first one didn't work and was canceled). i have been in bigger Clubhouse rooms
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the tech buzzword hype cycle plays out the same way every time. FIRST, a startup breaks out and VCs rush to fund it.
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His wife, a lawyer, was also allegedly in on it, fabricating bank accounts and audit statements, including one that showed a $13m cash balance when the real balance was $25.93(!!!!!!!). When investors demanded to see the bank account directly from the bank, the pair pulled this
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SmileDirectClub has filed for bankruptcy and alongside the announcement, they included an infographic listing other brands that have gone bankrupt. All the cool companies are doing it!
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4. VC firm FAKES signatures on the term sheet and threatens the startup with “nasty, public PR battles” and a “fight until the bitter end” if the startup doesn't take their $. 5. Startup sues, gets a different kind of $ - settlement. full story:
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That's how hard investors were fighting to dump money into startups over the last 2 years. Today it's more like the other way around. .
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would love someone to write a catchy song that teaches people. 100% = doubled.200% = tripled.300% = quadrupled.
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SCOOP: Robinhood just raised $1 billion in funding from existing investors. w/ @katekelly @nathanielpopper @andrewrsorkin
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my gamestop take is, what did we expect when we "democratized" day trading? social media democratized publishing and we got steak-umm and horse ebooks. the results are gonna be weird and random and terrifying and hilarious. i am enjoying it immensely.
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They are accused of using company/investor money for:.-a $4.2m home in SF .-private school for Beckman's kids.-their wedding venue.-jewelry stores.-luxury vehicles.-100k in personal property taxes.
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i finally did it, i kept a tab open for a full year. the author of the article has now changed jobs twice. what a run we've had, this tab and me.
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Craziest detail, IMO: Beckman allegedly claimed GameOn had $69m in revenue in 2022 and $54m in profit. Annual revenue NEVER EXCEEDED $1m since the company started.
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The pair got 25 counts of conspiracy, wire fraud, securities fraud, identity theft, and other offenses, plus obstruction of justice for Lau.
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GameOn was founded in 2014 and based in SF. It provided an AI chatbot for pro sports teams and luxury brands. Beckman's alleged lies start with his background: He told investors his past company sold for just under 100m when it actually sold for less than $2m.
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🩸Today is the final day of Elizabeth Holmes’s testimony. Since people have been asking, I thought I’d share my daily schedule for covering the trial. (The Four Points San Jose does not have stationary so I made do with this, uh… menu.)
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They tried to take out a loan to pay back the money and used fake board meeting minutes to support the loan application.
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Per the indictment, he also: .-described non-existent revenue.-inflated cash balances.-made up customers .-used the names of 7 real people (with fake email addresses and signatures) to share this false info with investors.
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"they soon realized that getting users to return the umbrellas would be a problem"
Umbrella-sharing startup loses nearly all of its 300,000 umbrellas in a matter of weeks
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Once again, I am outside the courthouse in San Jose at an ungodly hour. Today Elizabeth Holmes will be sentenced for defrauding investors at Theranos.
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Employees literally creating Jira tickets to "Add Fake Users & Fake Chats" to the platform.
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press release author: so, what does your company do? . ceo: we make software for call centers . PR: no no no that is way too easy to understand. how about,
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In other news BeReal passed 50m installs, per Sensortower. Instagram had 30m users when Facebook bought it for $1bn.
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Startups rarely die fast. Bird, backed by $600m in funding and once valued at $2.5bn, is now at risk of bankruptcy and trades at a market cap of *$13 million.*
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@Hipstercrite I once met Karl Malone and he shook my hand and told me to stay in school. I was 32.
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a good way to answer rude emails from angry men is to tell them they should smile more. so far response rate is 0%.
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we are at the "msft excel influencer making six figures" stage of the market
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Lau was working at a VC firm at the time, which confronted her about the allegations. She allegedly started deleting records.
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Last July @deantak at VentureBeat published a story about Beckman resigning that dug into the fraud accusations and missing $$.
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Crypto ppl writing me about this article saying "DUH! everyone knows that," might want to take a step outside the bubble. There's value in explaining things to the broader world and getting them on board rather than shitting on anyone who doesn't know.
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Tech dudes, not a good look to walk out of the room when a town hall on gender diversity begins #fortunetech.
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Elizabeth Holmes has been convicted on four counts of wire fraud and conspiracy to commit wire fraud. She was found not guilty on four counts. And the jury was unable to reach a verdict on three counts.
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NEW: The fallout from Theranos extends far beyond its own implosion. Female founders, especially in science and health care, have faced constant comparisons to Elizabeth Holmes. My story ahead of the upcoming Holmes trial:
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My latest feature is out today in @FortuneMagazine. It’s about 2016’s string of startup scandals:
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starting tomorrow I’m taking over Term Sheet, the daily newsletter that @danprimack leaves behind. subscribe here:
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long version: (short version: I’m joining @WIRED!)
some suggested listening for this morning’s newsletter
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Starting a new thread for this. 🩸 Elizabeth Holmes has taken the stand. 🩸.
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All the initial excitement and momentum quickly fades. A new buzzword emerges. Everyone moves on.
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"What's going on with you marketing an SPV to randos? . Please stop. This makes it seem like I'm desperate."
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Fireworks from @fredwilson at the NYC Summit on VCs that hold stocks after IPO instead of distributing to their LPs (iykyk): . "They should be fired. Their LPs should fire them and never give them another dime. It was irresponsible what they did.".
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historic levels of mortification in the airport today after my mom INSISTED I take my high school varsity jacket home and it didn’t fit in my suitcase 😑
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The whole time I was at Bitcoin 2021 I kept thinking "I hope everyone here is vaccinated." Then Ron Paul got on stage and said the pandemic was invented by politicians for entertainment, so I guess the reports of people getting sick shouldn't be a surprise.
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cars protesting an empty office building while everyone works from home feels exactly as absurd as everything else about the Robinhood/Gamestop story
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🩸🩸🩸Hello from the the dark of night in San Jose where I’m lined up for Elizabeth Holmes to take the stand again in her fraud trial.
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Lately I've realized that asking a CEO about their return-to-office plans is FRAUGHT. A lot of startups are really grappling with this and the most salient point I've heard so far is that young employees want an office - mentorship, networking, camaraderie, learning etc.
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Airbnb's first earnings as a public company are out: revenue decline and a big big loss
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feels like every week i get pitched on a startup with the same name as a defunct startup i covered years ago, which means i've been doing this too long or there aren't enough good startup names in the world.
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Investors asking FTX for better governance got told “go fuck yourself”.
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🩸A small portion of the US v Elizabeth Holmes courtroom tickets I’ve found hiding in various pants, coat and purse pockets…
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The FDIC backstop news broke while a plane full of techies was flying from SXSW to SF. They broke out in cheers.
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So the start-up fraud trial of the decade is about to begin. Hope everyone’s ready, we’ve got three months of this then we start over again with Balwani. In the meantime, here’s a thread of some stuff to read about it:.
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are we just programmed to default to zoom forever?. feels like every meeting i ask for a phone call and get a zoom invite. terrible development for those of us who like to pace :(.
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"Every time the bees were exposed to the coronavirus they stuck out their tongues.". I need to see a photo of a bee sticking its tongue out THIS INSTANT!!.
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at first you don’t wanna drink the Trump water because it might be poison. an hour later you’re hoping it is
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i dont know if trading meme stocks is still a thing but you guys did it, you killed a hedge fund!
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“Are you bringing back people to your big ass, giant ass building in San Francisco?” @karaswisher asks @Benioff
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Elon Musk "exposed his penis to her and offered to buy her a horse".
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a funny thing about going to an interview a startup founder is you never know if you're walking into an army of handlers in a conference room with a full catering spread. or 1 person who looks up from their laptop like they forgot you were coming, like oh right, you.
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Opening arguments for Epic vs. Apple will begin shortly. I'm here in the courtroom and can report that Epic CEO Tim Sweeney has ditched his cargo shorts and t-shirt for a suit. 🕴️. Read our preview of the trial here:
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New: It's been a rough month for Democrats in Silicon Valley as a series of tech leaders endorsed Donald Trump. But this weekend changed all that - and now they're feeling reinvigorated and hopeful. “People are fired up,” @nihalmehta said.
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On the VCs for Kamala call: Roy Bahat makes the pitch for VCs to back Harris using a language VCs understand: Powerpoint
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Still find it incredible that firms thinking adding all their partners' years of experience together sounds impressive.
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Why are so many founders stepping down? My latest is on the twilight of the boy bosses:
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Reading through texts between Elizabeth Holmes and Sunny Balwani in the latest filing from prosecutors. Come for the intense romantic texts, stay for the Alwaleed gossip
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I just can't get over this. These startups .-solicited detailed personally identifiable medical information about 100,000 customers .-told them their data is “protected” and “used only” by its care team.-SHARED IT WITH ADVERTISERS FOR YEARS .
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Epic v Apple verdict: Judge Gonzalez Rogers rules in favor of Apple on all but one on one count: Apple can no longer ban app companies from telling their customers to pay elsewhere.
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New from @yaffebellany and me: . How did Sam Bankman-Fried get connected to so many rich, powerful and famous people? . Through Michael Kives, a Hollywood agent-turned-VC, whose firm got $700m from FTX (including $125m to him personally).
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Testing out a theory: FTX is not going to put a massive chill on venture investment in crypto, as a lot of people are predicting. I've talked to a lot of crypto investors this week and all of them say this doesn't change their conviction about the category. (thread).
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NEW: Reid Hoffman is at the center of the AI action: He's on MSFT's board, he co-founded Inflection AI, he's invested in a bunch of AI companies including OpenAI and he frequently talks up AI to govt officials. (1/3) .
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🩸 The jury in the fraud trial of Sunny Balwani has reached a verdict. I'm here at the courthouse. It will be read at 11:20. Here we go!.
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This story has a little of everything! Angry, scared, wary and determined founders. Memes. Memos. Firesales. Apologies. Emergency bridge loans. Harrowing moments. Contingency plans. And Chick-fil-A.
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VC exits have are already breaking records this year, driven by SPACs, per S&P. If the pace continues, "VCs will have seen more liquidity via M&A this year than the entire period from 2012-2020.".
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if everyone could stop inventing new kinds of IPOs for a few minutes while i figure out the exact mechanics of the existing ones that would be great.
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We have an AI IPO! . Cerebras, a startup that makes giant chips, filed its S-1. They're growing fast but the biggest takeaway for me is that the Abu Dhabi-based G42 represents a whopping 87% of revenue. Story up soon.
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Sam Bankman-Fried says he was more focused on the upside scenarios and wildly underestimated how bad things could get in the downside. He says his lawyers have told him to stop talking, but "that's not who I am.".
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Layoffs, cost cutting and the move to remote led tech companies to shut their offices en masse, clearing out offices full of expensive designer furniture. Some of it has never been used. Amid the bust, a group of furniture hustlers sees opportunity. 🪑.
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run "we sell glasses" through the startup mission statement generator and you get.
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The mayor of Miami has resorted to cold calling VC firms
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@ranjanxroy in that case u may enjoy the first draft of this thread that i abandoned after i realized it was too much work to shrink all the little logos in MS paint
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the thing they don't tell you about covering trials is the glamour. sitting awkwardly in a skirt on the hallway floor, pulling down your mask to scarf your 100th bad starbucks sandwich this month while also charging your laptop, banging out a draft and cold callling experts.
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Bird investor presentation: "114% revenue growth" . Bird balance sheet: lol actually revenue fell 37% last year. Bird footnote: hehe so uh. that was actually ESTIMATED revenue growth for the end of next year 🙃
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