this post was submitted on 23 Dec 2023
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Pulse of Truth

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No Oversight: Inside a Boom-Time Start-Up Fraud and Its Unraveling (www.nytimes.com)
submitted 2 years ago by lemmydev2 to c/pulse_of_truth
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No Oversight: Inside a Boom-Time Start-Up Fraud and Its Unraveling

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[–] logicbomb321 1 points 2 years ago

Alternate Link

https://web.archive.org/web/20231225095838/https://www.nytimes.com/2023/12/22/technology/headspin-silicon-valley-startups.html

Generated Summary

The article discusses the fraudulent activities of Manish Lachwani at his start-up, HeadSpin. Lachwani inflated revenue, falsely claimed major clients, and misused company funds for stock trades. Despite no CFO or audits, investors overlooked these issues, leading to a $1.1 billion valuation. Lachwani, who pleaded guilty to fraud, exemplifies a trend in Silicon Valley of rapid growth overshadowing proper oversight. The case reflects a broader pattern of negligence in start-up governance, with similar instances in other companies. Following Lachwani's departure, HeadSpin's valuation has significantly decreased.