Goldman's $60M Nightmare: Wall Street Giant Duped By Tech Founder...

Goooodmorning and TGIF everyone!

Although it’s way too early to decide whether the All-Time High bandwagon was really the calm before the storm or not, the Magnificent 7 definitely got struck with something. 

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Ending yesterday deep in the red with $TSLA (-8.44%), $NVDA (-5.57%), and $META (-4.11%) being the groups worst performers, investors are holding their breaths on what today will bring. 

And since it’s Friday, the hope of the market closing on a good note is even more dire today. I mean seriously, who wants to start their weekend off after back to back red days? Literally no one.

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But, but, but… with the good news of inflation cooling (based on CPI numbers yesterday), it looks like Powell does know what he’s doing after all. After consumer prices unexpectedly fell month-over-month basis for the first time since 2020… 

(Source: Reuters) 

It will definitely be interesting to see how the market responds as the day unfolds. 

But whether degenerate investors get their faces ripped off, or they end up making an extra buck today, the big story this morning is a clear reminder that institutional investors on Wall Street are really just like you and I: 

They get really excited about an opportunity and they place the bet, only to eventually find themselves asking “WTF did I just do”… 

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And man, did Goldman Sachs do just that. 

After managing to acquire $60 million in funding from this Wall Street giant, Chris Kirchner, was living the high life as the typical “tech startup” founder. 

(Source: Gulf News) 

As the CEO of Slync, a logistics company that Kirsch promised to revolutionize the industry with, he was able to raise enough money to eventually get his company valued at a cool $240 million. Which in light of his idiocracy, is definitely something to be proud of.

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However, instead of actually “revolutionizing” logistics like he pitched to all of his investors who gave him $80+ million to use for growth, Kirschner decided to play real-life Monopoly instead. Typical tech bro… 

Dropping $16 million on a private jet, and buying enough luxury-exotic cars to make Jay Leno jealous, it turns out the fun in being a tech founder was more of a focus for this guy than actually running the company he founded. 

(Source: The Dallas Morning News) 

But before, investors who were none the wiser, could pull their money out - it was too late.

By mid-2022, Kirchner's empire started showing cracks. Forbes did a deep dive and found he was cooking the books, overstating revenue, and firing anyone who dared to call him out. Employees were left unpaid while Kirchner was jet-setting around the world. 

Chris Kirchner probably (Source: Pinterest) 

Eventually the house of cards came tumbling down when the FBI knocked on his door and charged him with fraud. 

(Source: Freight Wave) 

Kirchner's antics included funneling millions from Slync’s accounts directly into his own pockets through nearly 100 transactions. He even had the audacity to wire $20 million straight into his personal checking account. Talk about brazen.

Fast forward to the present, (yesterday) and Kirchner has been sentenced to 20 years in prison. 

But as if that kick in the kahuna’s wasn’t enough justice, the court also ordered him to pay back $65 million. 

(Source: Forbes) 

Which come to find out, is one of the harshest sentences for a tech founder in recent years, and it sends a clear message: you can’t just play fast and loose with investors' money and expect to get away with it. Clearly the guy was street smart, not necessarily “book” smart. 

Now with that said, since the conspiracy has officially unraveled, Slync is trying to distance itself from Kirchner, raising an additional $24 million in a desperate attempt to stay afloat. They brought in a new CEO and tried to reassure everyone that they were still a player in the logistics tech game. But let's be real, shaking off a scandal of this magnitude isn’t easy. Investors have long memories and short patience. 

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So as the opening bell rings this morning, and the market digests which direction it wants to take us in… what’s the takeaway here? 

First off, if something seems too good to be true, it probably is. When it comes to risking your hard earned money, due diligence isn’t just a buzzword - it’s a friggin necessity people. 

(Source: Yarn) 

Plus, this story is just a plain good reminder that even the big players who consistently screw the little guy end up getting it wrong now and then. When you play stupid games, you win stupid prizes and while Wall Street might have more zeros on their balance sheets, they’re not infallible. 

So next, time you’re looking at your losses from a bad investment, just be glad it wasn’t eviscerated like Goldman’s $60 million position. ‘Cause, you know, that would suuuuck. 

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Stocks.News holds positions in Tesla and Meta Platforms as mentioned in the article.