Startup accused of scamming employees scrubs its online presence
A little-known startup is in meltdown mode after a former employee took to Medium to accuse the company of scamming her out of her wages and firing her in retaliation after she filed a wage claim to recoup the unpaid cash. The Medium post was widely shared online; in response, the company shuttered its website and threatened legal action against the writer, calling her “a disgruntled former employee.”
Although the former employee, a digital marketer named Penny Kim, referred to the company as Startup X in her post, internet sleuths quickly discovered the company’s actual name: WrkRiot. Several other company advisors and employees have since come forward to share their own (largely negative) experiences with WrkRiot and its founder, Isaac Choi.
Kim agreed to move from her home in Texas to California for a marketing job at WrkRiot, which would pay her “a $10,000 sign on bonus (relocation assistance), a $135,000 salary, equity, and a 3 month severance package if I were to leave for good reason and without cause,” Kim wrote. However, the money never came through. Choi constantly gave excuses for the late payroll, according to Kim, and at one point forged a wire transfer confirmation that he emailed to employees. Another employee told Kim that Choi’s money was tied up in an IRS claim. After months of late or missing payroll, Kim filed a wage claim and says she was fired in retaliation.
The saga serves as a cautionary tale for startup employees: beware of founders who can’t back up their claims and ask to borrow money from their employees, Kim warned. But it’s also a warning signal for founders: Don’t mess with your employees’ money, or they’ll expose you on Medium.
Medium has become a clearinghouse for tech employees to air their grievances and hold employers accountable. In February, a Yelp worker named Talia Jane wrote a lengthy postaccusing the company of underpaying its employees and setting them up for failure in the expensive Bay Area economy. The post stirred up controversy for Yelp (and dozens of Medium rebuttals and rebuttals-of-rebuttals). In Kim’s case, her post appears to have knocked WrkRiot completely offline — visitors to the WrkRiot website are currently greeted with a message that says the website is expired, and the company’s social media accounts have vanished.
However, before making WrkRiot’s Facebook page private, the company posted a message denouncing Kim’s claims and threatening legal action. “WrkRiot is considering legal action against a disgruntled former employee who has launched a slanderous campaign against WrkRiot and some of its employees via social media,” the post said. “WrkRiot believes this former employee’s writings have led to dangerous situations for many of our employees through the leaking of personal information and through threats being made over social media from others who have taken the former employee’s misinformation as truth.” (There are not currently any lawsuits filed against Kim.)
WrkRiot also claimed that Kim was fired “for cause” and that she wrote her blog post after being denied $50,000 in severance. Choi has not responded to a request for comment from TechCrunch. Kim declined to comment.
An individual claiming to be the company’s CTO and using the Kim-assigned pseudonym “Charlie” backed up her account in a Hacker News comment. “The CEO stated he is putting in $2M to fund the startup in November. In December, with $400k or so in the company with the rest coming, we started to build. We grew steadily till about April with a prototype. At which point, the CEO kept mentioning money was coming with a few different reasons on why it did not arrive,” Charlie wrote.
Daniel Tunkelang, a data scientist who advised WrkRiot and has also advised Pinterest and Etsy, denounced WrkRiot in a blog post.
“Effective immediately, I have terminated any association with the company, and I have asked them to remove me from their team page and anywhere else they may have referred to me,” Tunkelang wrote. “Nonetheless, I owe an apology to anyone who took the company more seriously because of my association with them. I should have gotten to know the company and its leadership better before associating myself with them and lending them my credibility. Lesson learned.”