Author Topic: Article: I Got Scammed By A Silicon Valley Startup  (Read 4934 times)

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Offline ANTALIFE

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Article: I Got Scammed By A Silicon Valley Startup
« on: August 29, 2016, 10:55:20 pm »
https://medium.com/startup-grind/i-got-scammed-by-a-silicon-valley-startup-574ced8acdff#.hdjrrr5a0

Very interesting article that highlights what sort of red flags you should look for when working for a startup or any job for that matter.
 
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Offline StillTrying

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Re: Article: I Got Scammed By A Silicon Valley Startup
« Reply #1 on: August 30, 2016, 12:33:25 am »
It took a very long time for the Penny to drop there.
« Last Edit: August 30, 2016, 12:37:56 am by StillTrying »
CML+  That took much longer than I thought it would.
 

Online EEVblog

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Re: Article: I Got Scammed By A Silicon Valley Startup
« Reply #2 on: August 30, 2016, 01:22:39 am »
Wow, those forged deposit slips!
How stupid do you have to be to attempt that, you must know you will get caught  :palm:
 

Offline all_repair

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Re: Article: I Got Scammed By A Silicon Valley Startup
« Reply #3 on: August 30, 2016, 01:52:42 am »
Wow, those forged deposit slips!
How stupid do you have to be to attempt that, you must know you will get caught  :palm:

Yah.  Hard to believe people could do that, so fake so childish.
 

Offline zapta

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Re: Article: I Got Scammed By A Silicon Valley Startup
« Reply #4 on: August 30, 2016, 05:40:38 am »
I was involved once in a startup like that, the CEO was a sociopath and things went crazy for a few months. It opened my eyes about the diversity of people brains' wirings. It took the main investor and myself (a co founder) almost a year to clean the company and get back on track. Last time I checked, the CEO, which we found later doesn't have a college degree, presents himself as a professor for medicine in another company he established.

I spent a big chunk of my careers in startups and it can be very intense, an emotional roller coaster, especially if you are 'all in'.  It's a very good life experience IMO.
Drain the swamp.
 

Offline ez24

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Re: Article: I Got Scammed By A Silicon Valley Startup
« Reply #5 on: August 30, 2016, 06:10:09 am »
Bummer at least the OP could have given us more details on Batterizier

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Offline ANTALIFE

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Re: Article: I Got Scammed By A Silicon Valley Startup
« Reply #6 on: August 30, 2016, 08:09:48 am »

Offline edy

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Re: Article: I Got Scammed By A Silicon Valley Startup
« Reply #7 on: August 30, 2016, 05:46:46 pm »
The old saying... With big risk *may come* big rewards. But let's not forget the RISK part of it.

Ultimately, if this startup had actually succeeded, these founding employers may have been able to ask for stock options in lieu of salary which could someday be worth millions. Sadly, their eyes and judgement as to the job risk they were undertaking were clouded in the excitement of this venture..... How many "startups" actually make it, and how many crash and burn? Would you quit a stable job to be part of an unknown startup, the majority of which never last?

You need to treat a startup differently, keep light-footed and don't make any major life-changes. It seems that is what Penny, the author of the article DID. She covered her arse "CYA"  :-+  It is especially easy if you are young, not settled down, have no kids, can move to a new town and rent a place by the week or month, commute by bike or transit, and just to see how things go. A startup is not the kind of venture someone with a family and other responsibilities should be involved with, unless they have bonafide SECURITY such as guaranteed pay up-front.  But even here, the moving bonus and severance was not guaranteed... it had to be fought in court. At your own expense, and likely not worth the hassle.

I'm not trying to blame employees for this. Especially those H1-B VISA people who were basically taken advantage of. How many are brought over to slave away lest be deported when the sponsoring company pulls your plug? Then again, what options would they have had back home? Yes every employee should be paid, for every hour of work, and on time. The CEO was a criminal or at least acted in ways that should be considered that way. However, as the article mentions there were many red flags that should have been heeded. Of course, no amount of contracts and signatures will completely protect you, and if somebody scams everybody and goes bankrupt, good luck getting paid.

Life lesson... don't be strung around for too long, the job was insecure, the company had a huge risk of not making it and defaulting on payments. Penny seems to have been more skeptical than most and didn't let herself get too cozy. It went pretty fast too... all started May 2016...   June... July... August.... Hasn't been that long. But it was a RISKY job proposition from the start, which is why Penny did "CYA" and probably kept her ears and eyes wide open throughout the entire time she worked there.... And ended up not losing that much in retrospect than she might have otherwise.

NOTE: Apparently, they used to be called 1for.one, then JobSonic, then WrkRiot, but may have returned to using JobSonic again. They are lashing out against "Penny" for defaming them and things are getting ugly. Time for courts to step in.
« Last Edit: August 30, 2016, 06:12:27 pm by edy »
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Offline kfnight

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Offline zapta

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Re: Article: I Got Scammed By A Silicon Valley Startup
« Reply #9 on: September 02, 2016, 10:34:47 pm »
Do they bring the other side as well?
Drain the swamp.
 

Offline snoopy

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Re: Article: I Got Scammed By A Silicon Valley Startup
« Reply #10 on: September 20, 2016, 01:26:41 pm »
They sound like scam artists with some alleged multi-millionaire dollar hare-brained idea looking for suckers to offload all of their risk onto in exchange for the road to riches.

I've dealt with many like this my time. It never ceases to amaze me how many gullible people fall for these types.

Just recently I had two clowns pester me to hand over to them 2-3 years worth of my R&D to them in exchange for royalty payments that may or may not happen some years into the future. They reckoned that their R&D budget was already stretched even though they had pictures on their facebook page from overseas junkets. :-DD

Two rules I have with these scammers is:-

1/ Don't do things for nothing for the wrong people - It's better to sit at home and watch a youtube video because it is a lot less stressful and the end result of  not being payed is the same.

2/ Don't give your IP away for nothing unless it is open source etc.

Recently those two basic rules have saved my arse on a number of occasions.

Also another rule that I have added to my rule list is:-

3/ Don't ignore the bullshit meter and don't be afraid to challenge people who you suspect are trying to con you. You can save a whole heap of time and grief if you fish them out at an early stage. Don't let them think they can keep coming back for more.

Recently I ignored rule 3 and ended up wasting countless time with a confidence trickster who thought he could ring me up with impunity and play games with me like I was his free advisory service whilst he was holding back on the most trivia-list of information. Ignore the bullshit meter at your own peril :(

cheers





 

Offline StuUK

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Re: Article: I Got Scammed By A Silicon Valley Startup
« Reply #11 on: September 20, 2016, 02:30:55 pm »
Sadly this is a common story and I bet you the founders are not out of pocket.....
 

Offline edy

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Re: Article: I Got Scammed By A Silicon Valley Startup
« Reply #12 on: September 21, 2016, 04:33:04 am »
Speaking of investing opportunities, I have this local Canadian company that has developed an app/platform that is similar to Facebook but meant for professionals of a certain industry and related industries to communicate and talk to each other. I don't want to mention any specific names, but the app is available on iPhone and Android... it already exists but not that many users are on there.

I have had some meetings with the founders because I showed some early interest and I have some expertise in my industry and how we would utilize such a platform, whether it is a good idea, what pitfalls there may be, etc. So I invited them to my office and we spoke and reviewed the pros and cons.

They are looking for more investment and say they are giving me this "opportunity" to put in minimum of $10,000 to buy into the company and that they only are extending this to family and friends. They want to let me buy in because I am helping them with sharing my ideas.  They are giving me this chance to invest... that this chance to get in on seed-funding will not happen again as they are moving on to the next stage of investment from big players only and that no other opportunities will exist to "get in" on the company unless it goes public. :blah:

Anyways, as much as I like the app and it seems like a reasonable platform and it is up and running and available for download, I still see it as a HUGE RISK to invest in. Nobody can tell me this platform will take off, that users will adopt it and that it will become monetizable any time in the near future. Just because it is like a "spin" on Facebook but tailored to the needs of a specific industry doesn't mean user adoption will be viral. How many apps and websites have come and gone?

So they probably spent a few hundred thousand on their team of developers working to make the app over the past year. Perhaps some government grants, industry initiatives/rewards for innovation, and one or two founding investors poured money to get the app made and in the iPhone and Android app stores. Now they have a platform similar to Facebook (allowing users to privately message, post stuff, search for tags, view feeds, etc) but have to work hard to build up their user base in my industry or several related ones. Their idea to monetize the platform is to have companies that sell products/equipment/services for my industry start to pay for advertising on the platform, similar to how Facebook may insert ads in your timeline/newsfeed. Or perhaps people in my industry looking for hire/jobs, and also for education/courses. There is secure messaging and group messaging, and there may be a vetting process as well because members are checked against government licensing registers to make sure they are who they say they are, and confirmed by phone call to places of business. 

Like I said, all-in-all it's a nice idea and if we lived in a fairy-tale unicorn world this app would be used by people. But then again, I see and know first-hand my industry and the snails-pace that they would begin using any app. I also know other platforms, apps, websites that are also specific to my industry and sadly not all of them do well when you think they should. It's a pretty flakey bet... and I'm not at a stage in my life to handle this kind of risk/reward.

So what do you think?
« Last Edit: September 21, 2016, 04:42:18 am by edy »
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Offline Xenoamor

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Re: Article: I Got Scammed By A Silicon Valley Startup
« Reply #13 on: September 21, 2016, 12:27:09 pm »
So what do you think?

I don't know what industry it's for but I can't see this being particularly useful.
We use Ryver which is basically a free Slack and that works on all phones/OS but obviously this is for inter-company communication

I wouldn't be able to stand being locked into a phone app for any professional work.

We need to know exactly what the industry is to really be able to comment
 

Online EEVblog

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Re: Article: I Got Scammed By A Silicon Valley Startup
« Reply #14 on: September 21, 2016, 12:45:30 pm »
Anyways, as much as I like the app and it seems like a reasonable platform and it is up and running and available for download, I still see it as a HUGE RISK to invest in.

Its is.
The percentage of startups with app ideas like this that go on the succeed and make money would be down in the single digit precentage range.
I'm sure some would say it's not even a single digit.

Quote
Nobody can tell me this platform will take off, that users will adopt it and that it will become monetizable any time in the near future. Just because it is like a "spin" on Facebook but tailored to the needs of a specific industry doesn't mean user adoption will be viral. How many apps and websites have come and gone?

The death knell for any app idea is when they say
"it's like Facebook for *insert market*"

Quote
So what do you think?

If $10k is chump change to you then maybe have a punt, but if it's a a lot of money to you then let it slide. Odds are it'll tank.
 

Offline StuUK

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Re: Article: I Got Scammed By A Silicon Valley Startup
« Reply #15 on: September 21, 2016, 01:40:11 pm »

So what do you think?

Could you afford to put your investment on the roulette table and lose it? if so, why not! but you'll stand more chance of winning on the roulette table in a single play on 0 than this succeeding....
 

Offline Delta

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Re: Article: I Got Scammed By A Silicon Valley Startup
« Reply #16 on: September 21, 2016, 02:58:50 pm »
Gah!  Why does everything have to be "an app"?  Not a service, a system, or even a website.  It's a blood "app"....  |O
 

Offline edy

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Re: Article: I Got Scammed By A Silicon Valley Startup
« Reply #17 on: September 22, 2016, 02:16:56 pm »
Yes, that's what I figured. The only way to make money on this is to stay in while it builds up momentum and speculated on by investors down the line... and then "bail" at the opportune time. If you are the last one holding it, you'll likely get burned. That is, bail at the IPO.
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