GoMechanic lays off 70% after investors discover 'founders knowingly misstated facts'

Wednesday, January 18, 2023

Helloooo, Crunchers! The heavy goods train of tech news keeps on rollin’ down (and sometimes off) the tracks.

Apropos tracks, we’ve been a little besotted with this absolutely magnificent music video of Ren this week. It’s full of surprises and powerful bits — give yourself a 9-minute break and give it a listen! — Christine and Haje

Image Credits: GoMechanic

The TechCrunch Top 3

More layoffs: Sequoia-backed GoMechanic is the latest to make sweeping layoffs after funding didn’t materialize in time, Manish reports. The India-based auto services company is cutting 70% of its workforce. But wait, there’s more: GoMechanic’s founders misstated financials to investors with GoMechanic co-founder Amit Bhasin saying the startup made “grave errors in judgment as we followed growth at all costs, particularly in regard to financial reporting, which we deeply regret.”
Can your robot do this?: In Boston Dynamics’ latest Atlas video, we see its robot running, jumping and now grabbing and throwing things via the use of hands. Matt shares more.
If you’ve never seen a car that looks like its name, you have now: Romain has your look at Kate, a new French carmaker developing tiny cars for your everyday use, from driving to work to driving on the beach. They remind us of a really fast golf cart only cuter.

What is Revenue Lifecycle Management?

In a press conference on Wednesday, the U.S. Department of Justice announced that it has arrested Anatoly Legkodymov, founder of crypto exchange Bitzlato, for allegedly processing over $700 million of illicit funds, Amanda reports. “Overnight, the Department worked with key partners here and abroad to disrupt Bitzlato, the China-based money-laundering engine that fueled a high-tech axis of cryptocrime, and to arrest its founder, Russian national Anatoly Legkodymov,” said Deputy Attorney General Lisa O. Monaco.

There’s a bunch more stuff happening in the world of startups today:

Well oil’ll say: Kirsten reports that Shell snaps up EV charging operator Volta for $169 million.
It’s not like we could remember our passwords anyway: Open source password management company Bitwarden acquires Passwordless.dev to help companies authenticate users without passwords, Paul reports.
PayPal Ventures buys now, hopes it will pay back later: Buy now, pay later company Tabby raises $58 million at a $660 million valuation as PayPal Ventures deploys its first investment into the GCC, Tage reports.
BainFund: Kate reports that the P2P lending platform PeopleFund raises $20 million in a Series C extension round led by Bain Capital.
Ta-daaa! Money for you: Amanda reports that Goldenset launches out of stealth to make equity investments in creators.

Dear Sophie: What are some fast options for hiring someone on an expiring grace period?

Dear Sophie,

I’m a co-founder of a very early-stage startup. My co-founder and I are considering bringing on a third co-founder, who was recently laid off. She is currently in the United States on an H-1B with a grace period that will expire soon.

What are the fastest, least risky immigration options that we should consider? What’s going on with potential increases to USCIS filing fees?

— Careful Co-founder

Three more from the TC+ team:

Losing the horn: VCs think majority of unicorns aren’t worth $1 billion anymore, by Becca.
Leaning into that midday energy: Noon Energy brings Mars tech down to Earth with carbon-oxygen battery system, Tim writes.
Let’s spreadsheet this out, shall we: Anna puts numbers on the global venture slowdown.

TechCrunch+ is our membership program that helps founders and startup teams get ahead of the pack. You can sign up here. Use code “DC” for a 15% discount on an annual subscription!

Big Tech Inc.

The layoffs just keep coming in Tech World. The latest is Microsoft, which announced 10,000 job cuts, reports Paul. The company has already made some layoffs last year, but this latest one accounts for a sizable chunk of its workforce — 5%. CEO Satya Nadella echoed other tech companies making layoffs recently in saying that the company accelerated its growth as customers grew, but when that slowed down, Microsoft had to do the same.

Cybersecurity company Sophos is making a similar move, laying off 450 employees globally, or about 10% of its employees, Jagmeet reports.

Meanwhile, in happier news, Apple has a brand-new HomePod with better sound and “smarts,” Darrell writes. And now that you know this, Brian has some thoughts on the newly returned smart speaker.

Here’s five more for you:

Get the skinny on OpenAI: Connie’s conversation last week with OpenAI CEO Sam Altman continues to yield all sorts of juicy details, this time about the company’s deal with Microsoft. Altman confirmed that was not an exclusive pact, she writes.
This message brought to you by…: TikTok now has a “state-controlled media” label in 40 more countries to show “whose ‘editorial output or decision-making process’ is subject to influence by a government,” Sarah writes.
If you’re feeling Blue: Twitter now offers an annual Blue subscription for those hardcore users, Ivan reports.
A tribute: Brian gives a final salute to Google Stadia, which shut down today.
Another go at it: For the second time in six months, Mailchimp says it was hacked. Zack has more on what happened this time.