Startup Workers Left High and Dry | Employees Seek Justice After Two Years of Free Labor
A startup in Wyoming is under fire as 110 employees worked for two years without pay, relying only on equity and promises of a crypto token. Following a successful product launch, the CEO and Head Engineer claimed most of the token ownership, leaving workers with little to show for their efforts.
The Entrepreneurial Gamble
This Texas-based startup operated remotely, creating a software product aimed at enhancing security. Along with the product, there was excitement about a new token, anticipated to have financial value. However, the organization’s claims quickly turned sour once it became profitable, generating over seven figures in revenue.
Eye-Opening Token Control
Just two weeks after the launch, it was revealed that the CEO and Head Engineer control 99% of the tokens, with the other 108 employees sharing a mere 1%. One commentator pointed out the absurdity of the situation: "Why would anyone work for shares without knowing the total?"
Even more alarming, the cap table indicated the two top executives held 98% of the company's equity. Many employees now feel deceived as their stakes diluted dramatically.
Employee Sentiments: Confusion and Frustration
As discontent bubbles, forum comments spotlight employee frustrations:
A commenter noted, "It’s illegal to pay your employees in worthless equity and crypto."
Another reflected, "Sounds like no promises were broken. Why would there be recourse?"
These sentiments point to a prevailing sense of powerlessness among the staff as they contemplate their next steps.
Remote Workforce Dynamics and Allegations of Deceit
With the company based in Wyoming but employees located globally—many in India—it’s alleged that neither the CEO nor the Head Engineer are using their real names. This raises questions about accountability and transparency. One commenter encouraged legal action to address what has unfolded, arguing that "the CEO has offloaded all risk onto the workers.”
The Bigger Picture: Crypto Complications
Amid this controversy, discussions about the inherent risks associated with crypto-based engagements have intensified. The unexpected combination of a legitimate software product with a crypto token has surprised experts, leading to skepticism about the startup’s long-term viability.
Significant Observations:
🚩 99% of the tokens held by CEO/Head Engineer, leaving employees marginalized
📉 Uncertainty pervades as employees explore legal recourse
🚫 No tax documentation filed or contracts provided
As the fallout continues, the situation serves as a warning for future employees considering equity-based compensation in startups. The lack of transparency and oversight in this environment can lead to disappointing outcomes for those eager to contribute their talents.
Legal Implications Ahead
The likelihood of employees pursuing legal action appears to be growing, as many seek clarity on their rights. Experts suggest there may be a significant chance that a class-action lawsuit could emerge. With no contracts or tax documents, the route to recourse seems steep—dependent on state labor laws surrounding unpaid wages and equity.
Lessons from History
In a historical echo, this scenario reflects challenges faced by employees during the dot-com bubble, who similarly found their efforts in startups unpaid or undervalued. Those involved in high-risk sectors, such as crypto, must remain vigilant, as the pursuit of extraordinary gains often leads to inherent dangers.