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Ask HN: Should I inform investors that my startup employer is a scam?

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Re: Ask HN: Should I inform investors that my startup employer is a scam?

#51

Post by MrDresden »

Personally, I would feel uncomfortable staying with such a company.

My advice would be to leave as soon as possible. If no technical work is happening then you are not building anything for your resume, and if the company goes under then its bad practices might be revealed. That would make the time you spent there seem like a toxic spot on your career.

On revealing them, I feel the VC is required to do their due diligence and the amount of legal headache and exposure you as an individual would have to deal with if ever discovered to be the revealing party is not worth it.

Exit, and tell friends to avoid being hired by this firm.

Re: Ask HN: Should I inform investors that my startup employer is a scam?

#52

Post by hnbad »

cordialthank wrote: post #3
goncalo-r wrote: post #2

I would just find another job, let them crash and burn on their own

Well this is another discussion. I can do just that separately. But it doesn't seem fair to the employees who stay and believe the company's vaporware of making value and have their equity worth millions in an indefinite future time?

Are those other employees getting paid? Then there's nothing to worry about.

Equity is a gamble and should be treated as such. Most jobs don't contribute any value in the grand scheme of things beyond shareholder value, so that's not a loss either. If anything it's a learning opportunity to not trust startup founders so blindly.

But if you want to warn your coworkers out of comradery, do so in a way that isn't simply telling them "I think our boss is defrauding investors".

Re: Ask HN: Should I inform investors that my startup employer is a scam?

#53

Post by DoughnutHole »

ISL wrote: post #41
heassler wrote: post #9

If you see fraud and you don't shout fraud, you are a fraud. Document your findings and do what is appropriate. After all, those VCs are managing people's money. They need to know.

If pursuing this strategy, step 0 should be consulting an excellent attorney.

Regardless of whether or not you pursue this strategy it may be worth consulting an attorney. You know what's more legally precarious than blowing the whistle? Having kept quiet before someone else blows the whistle.

If you're pretty for down the totem pole you're probably safe, but awareness of fraud without exposing it can very often leave you legally liable. If you're in any kind of leadership position you could be one of the people that end up taking the fall.

Re: Ask HN: Should I inform investors that my startup employer is a scam?

#55

Post by rob74 »

qikInNdOutReply wrote: post #38

Its a money laundering machine.. the oligarch invest dirty money into it, they buy equipment from other oligarch conglomerate companies, washing the money in the process. Just build your dream project there, and then take it with you. Its basically a mafiosi incubator and the software is decoration and they do not recognize the value of it missing or ever having existed. Could be other things to. Empty houses in the…

Maybe? But then why go through the "bankrupt -> saved in last minute" cycle several times and generate unwanted attention? I'm not an expert of course, but I think if you want to launder money, you should do it as quietly and inconspicuously as possible...

Re: Ask HN: Should I inform investors that my startup employer is a scam?

#56

Post by cordialthank »

imdsm wrote: post #37
mousetree wrote: post #31

Earlier quoted context omitted.

Why do they keep hiring people if there is no product to build?

Could be that they're siloed and there is product but OP is poorly informed. If they don't work there, then how could OP truly know?

Didn't stress on this point, but CEO is delusional and megalomaniac. They think their plan is going to work and they keep hiring people for stuff that supposedly will build up the SaaS. They are emotionally abusive to dissidents and people who disagree. It's a lost cause.

I'm not poorly informed, otherwise I wouldn't be making this post. After everyone left I am in the most senior engineer position (lead) and there was no one left on top except for me and the CEO.

Re: Ask HN: Should I inform investors that my startup employer is a scam?

#57

Post by fasteo »

Beltiras wrote: post #34
fasteo wrote: post #30

>>> When I say "no product" I literally mean it. It only exists on a powerpoint slide without a single line of code implemented. It seems obvious to me that VC is part of the scam >>> Should I anonymously inform investors that my startup employer is a scam, and if yes, how should I approach it? I wouldn't but, if you decide to inform don't report to the VC, but the people/entities above this VC (could be another VC,…

None of this is legal advice (IANAL). If you live in a country where there are whistleblower protections you should talk with an attorney and see if you can report this to the relevant investigative authority under protection of that statute.

Great point

Re: Ask HN: Should I inform investors that my startup employer is a scam?

#58

Post by austinjp »

Get out, then anonymously warn the appropriate financial authority/regulator. Optionally, and if it's safe for you and for them, you might want to anonymously warn the employees like yourself, but this might be impossible or unwise.

Consider that someone else may already be planning to warn the authorities. To avoid or minimise involvement in any legal issues yourself if the company goes down, you should be able to prove you were either naive (very difficult) or had misgivings -- in which case you may need to demonstrate intention to act.

You've already written this post, so if you can prove authorship that would be good. An encrypted string in your profile, perhaps.

As others have said, you really need to talk with a lawyer.

The reasons I suggest this course of action: be the change you want to see in the world. You'll feel better about yourself. God knows what this organisation is actually doing; you were a naive cog in the machine but you're no longer naive, and you don't need that responsibility on your mind.

Finally, regardless of your actions, you should think about how your CV/résumé reflects the time you've spent at this company. Don't hide the truth, but of course don't flat-out divulge everything.

Re: Ask HN: Should I inform investors that my startup employer is a scam?

#59

Post by raverbashing »

rob74 wrote: post #55
qikInNdOutReply wrote: post #38

Its a money laundering machine.. the oligarch invest dirty money into it, they buy equipment from other oligarch conglomerate companies, washing the money in the process. Just build your dream project there, and then take it with you. Its basically a mafiosi incubator and the software is decoration and they do not recognize the value of it missing or ever having existed. Could be other things to. Empty houses in the…

Maybe? But then why go through the "bankrupt -> saved in last minute" cycle several times and generate unwanted attention? I'm not an expert of course, but I think if you want to launder money, you should do it as quietly and inconspicuously as possible...

It's probably not officially bankrupt, it's "almost bankrupt".

Re: Ask HN: Should I inform investors that my startup employer is a scam?

#60

Post by blitzar »

unixhero wrote: post #35
cordialthank wrote: post #15

Earlier quoted context omitted.

Well this isn't about my job. I didn't mention once the problem was me losing my job or anything.

Good. Then please elanorate if you wsnt; what is it ypu want to achieve with informing someone about the situation?

achieve the and then everyone applauded ending.
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