Dear fellow GatherOnline investor,
We bring to your attention a very critical issue regarding the criminal activities of the GatherOnline company, owned by Michael Van Andel(41%) and David Price(38%). Although the principles behind it are as old as time the way it is conceived now makes it very efficient.
My brother and I are the developers that created the mobile apps and a lot of the new features for GatherOnline that were used in the two crowdfunding campaigns on Seedrs and Equitise where the company got more than $800,000 in investments. We are both programmers and live in Romania, I’m Computer Engineer, in my 4th year of PhD, my brother is a Computer Science graduate.
David Price is the CEO of the company so we mostly talked to him, I didn’t know much about them before I started working but I am a person of good faith so I trusted him on his word.
He said he will pay $10K per month for me to work together with my brother ($7000 me , $3000 my brother) and any extra hours we do will be paid in equity at 2.5x hourly rate. Based on these terms me and my brother spent all holidays and New Year’s working to have the apps finished as soon as possible and most of the weekends.
Immediately after the apps were launched and the two crowdfunding campaigns ended we started working on the new website features that were suppose to be the basis of a third crowdfunding campaign.
As soon as we finished implementing the new website features that were going to be used in the new crowdfunding campaign we were fired without any prior notice and also denied the payment for the outstanding invoices from the 10 months we worked for them that amounts to around $110,000.
After we got fired we started investigating the GatherOnline company and so we discovered an ongoing pattern of crimes that allowed the owners Michael Van Andel and David Price to get money from investors in crowdfunding campaigns which were later funneled out of the company using fake hires.
In fact they have been using the same routine since they launched the company and probably before that. We were the third cycle we know of.
The company forged documents regarding user statistics and valuation, blackmailed developers with bad reviews so they don’t have to pay them for their work and embezzled funds using fake hires.
When we checked the crowdfunding platforms they used, and saw what documents they submitted to the public, we realised they were using a fake valuation (over $8 million), made by some person that we traced back to a fake LinkedIn account, and based on that valuation they obtained entrance in the crowdfunding platforms.
To get money from investors they forged documents related to user statistics, there are documents showing how they lie about the number of users, from 20 users (as can be seen in the User Data Dump that we already submitted as evidence to Seedrs and Equitise) to 25,000 users per day.
They blackmailed people that used to work for them in order to extort any outstanding payments and also used fake hires, people hired on completely irrelevant roles in the company that were friends of theirs and some didn’t even exist (we found fake LinkedIn accounts) in order to funnel money out of the company. For all of this we have evidence that we documented on this blog in previous articles.
So from what information we could gather during our research we noticed this pattern:
- they get some new developers on board with the promise they will get equity and a good salary
- once the developer finishes creating a new version of the product or adds new features to make it seem that work was done on the platform, they start a new crowdfunding campaign on platforms they already know won’t have a thorough screening process or they know someone from the inside
- they present a fake company valuation and fake user statistics and lie about how the new technology stack or new features highly increased user count. (how can a 20 user per day company be evaluated at 8 million dollars?)
- investors have no way of verifying if the information is fake so they invest in good faith
- after the crowdfunding campaign is over and the money arrives in their bank account they immediately fire the developer/s without notice and try to get from them as much free work they can get by not paying the last invoices, nor any overtime they did or equity. They often blackmail the developer or people they fire with bad reviews on freelancer websites or lawsuits.
- they funnel money out of the company using fake hires, roles that do nothing and aren’t at all relevant to the company at a startup stage, and some even have fake linkedin accounts as we discovered in our investigation
- when they are getting low on funds they start again at step 1
You can find on the blog the email threads between us and the company owners. Everyone we presented this case to (lawyers and friends) told us it’s a criminal case.
We believe this people are going to continue doing the same thing to other programmers and investors. As I already said they were already setting up a new crowdfunding round based on fake statistics and the code me and my brother wrote.
After we showed the evidence to Seedrs and Equitise (the 2 platforms they used), in the form of a User Data Dump (where everyone can clearly see they were forging user statistics documents), invoices we sent them that they never paid and fake LinkedIn profiles used in the fake hires, they canceled their new round of crowdfunding.
Also please check this Reddit Thread we created which got a lot of exposure (8.5K views) and 94% upvotes regarding this case: https://www.reddit.com/r/legaladvice/comments/72swfb/startup_scam_is_trying_to_get_away_with_over/
“In matters of truth and justice, there is no difference between large and small problems, for issues concerning the treatment of people are all the same.” Albert Einstein
Manuel Adelin Manolache