Jake Soberal and Irma Olguin Jr., the CEOs and co-founders of Fresno tech training and incubation startup Bitwise Industries, were fired from their jobs less than a week after the company furloughed its 900 employees.
Three hundred employees in Fresno and hundreds more in Merced, Bakersfield, Oakland, El Paso, Texas and Toledo, Ohio, among other cities across the country, learned of the furloughs Monday night, according to the Fresno Bee. At the time, Soberal told the Bee that several major transactions “did not materialize or materialized unfavorably,” and the company’s board decided in an emergency meeting to take this “very temporary action.” However, the employees were not given a timetable for when they could return to work and it was assumed that they had been laid off.
The termination of Soberal and Olguín Jr. was the next domino to topple as more information about the crumbling company and its financial problems came to light. Ollen Douglass, a Bitwise board member since 2021 who will now serve as Bitwise’s interim chairman, said the board of directors voted to fire the co-founders while they conduct an investigation into the circumstances surrounding the company’s collapse.
“Unfortunately, the non-management board and I, like many of you, are finding that the picture the company consistently communicated orally and in presentations is not an accurate picture of the company’s financial health,” Douglass wrote in an email. email to employees. Friday night. “It’s heartbreaking and disappointing on multiple levels, as you know.”
Bitwise was founded in 2013 as a coding boot camp that eventually rented offices and co-working spaces across the country, training thousands of workers in its mission to revitalize inner cities and bring tech jobs to underserved communities. It grew to raise $180 million in funding over the past decade, including an $80 million investment round led by the Motley Fool Foundation in February, the company’s largest yet.
But on Wednesday, Fresno Mayor Jerry Dyer said the company had not paid the city’s business license taxes since September 2021, and that its licenses violated the Worker Adjustment and Retraining Notification (WARN) Act. California, which requires employers to give 60-day notice if they lay off more than 50 employees in a 30-day period.
On Thursday, the San Joaquin Valley Sun reported that Soberal allegedly intentionally misled investors about the status of the company’s shares while seeking to raise capital. And on Friday, Baltara Enterprises LP, which owns three Bitwise-operated buildings in Fresno, posted vacancy notices for the properties, indicating Bitwise was at least two months behind on lease payments, the Fresno Bee reported.
“We are committed to finding out how this happened and taking appropriate action,” Douglass wrote.
Stephen Council, SFGATE Technology Reporter, contributed to this report.
