A Southlake CEO had a lavish way of life. He’s now on the heart of a $67 million fraud case.

The CEO of a Southlake-based provide chain tech agency purchased a $16.1 million non-public jet in early 2021, simply as the corporate was elevating its runoff funding and simply earlier than it ran out of cash to pay its workers.

In response to court docket paperwork, Slync CEO Chris Kirchner instructed board members and traders that profitable cryptocurrency investments allowed him to buy the aspirational Gulfstream G550 drone.

When a Twitter person requested if it was price greater than $6 million, Kirchner replied in a now-deleted tweet, “I paid money for my airplane.” … So sure.

Kirchner, 35, has since been fired from the closely supported enterprise and has been charged with fraud by the U.S. Securities and Trade Fee and the Division of Justice for allegedly stealing firm funds for private use, together with the jet. He’s additionally accused of creating false guarantees to traders in capital will increase. He faces 20 years in jail.

In response to the SEC grievance, $28 million of the $67 million the corporate raised from Goldman Sachs and different traders in 2020 and 2021 was stolen to fund Kirchner’s luxurious way of life. He spent $495,000 on a luxurious suite at a North Texas sports activities stadium, about $22,000 on membership charges for a personal golf membership in Westlake, $902,000 on private bank card bills, and about $274,000 on luxurious concierge providers for his non-public jet.

In response to the grievance, Kirchner wanted permission from the chief of employees to switch greater than $100,000 from the corporate’s essential checking account. Earlier than buying his airplane, he knowledgeable the chief of employees {that a} huge week was approaching for the corporate earlier than it may switch $20 million with out alarm.

He bought the airplane for $17 million in August 2022 to assist repay his money owed.

Kirchner’s legal professional, Toby Galloway, declined a request for an interview. Makes an attempt to succeed in Kirchner by cellphone and electronic mail have been unsuccessful.

Slync spokesman Greg Kefer stated the corporate is cooperating with authorities investigations and appears ahead to a good decision of this matter as a sufferer of Christopher Kirchner’s actions. The corporate has a brand new CEO named John City, whom Kirchner employed as a strategic guide in 2018.

Kefer stated we did not look again and moved on.

An enthralling vendor

Earlier than founding Slync, Kirchner went to Butler College in 2006 and 2007 to review advertising. She then transferred to the College of Kentucky, the place she enrolled within the spring and fall of 2009 after which within the fall of 2015, and studied for a bachelor’s diploma in communications. Each universities confirmed that she did not graduate.

Kirchner helped discovered Slync in 2017, eager to create a Salesforce-like platform for provide chain logistics. It was based in Delaware, headquartered in California, and later moved to Texas in 2020.

Whereas the enterprise began slower, elevating round $2 million earlier than January 2020, it hit gold when the COVID pandemic disrupted the availability chain.

Between March 2020 and Might 2021, Kirchner guided the corporate via two funding rounds price over $67 million, the second being led by Goldman Sachs.

In response to former workers who wished to stay nameless to distract themselves from the corporate’s collapse, he was a born salesman.

“You tended to imagine him immediately as a result of he was persuasive,” stated a former worker who left final 12 months. So long as you might be on his good aspect, he’s very honest and desires to be your pal.

The previous worker stated that Kirchner not often got here to the workplace and instructed the staff that he flew to fulfill with enterprise capitalists and purchasers, regardless that they typically noticed that nothing got here of these journeys.

Kirchner had a eager curiosity in sports activities sponsorships, together with changing into the Dallas Stars’ official logistics companion in 2021. In response to The Athletic, the corporate has not made funds to the NHL group, which has over $800,000 in debt as of final summer time.

In 2022, Slync turned the title sponsor of the long-lasting European Tour occasion, the Dubai Desert Traditional, residence to prime golfers like Rory McIlroy and Sergio Garca.

Kirchner was entrance and heart, photographed subsequent to His Highness Sheikh Ahmed, handing it to 2022 award winner Viktor Hovland.

The facade is collapsing

The intrigue, with Kirchner accused of issuing false income figures for traders, elevating capital after which generally instantly transferring it to his checking account, started to break down final April when the corporate as soon as once more did not pay its workers on time.

One of many first public indicators of economic hassle got here that very same month, when Kirchner was named the popular bidder to purchase English soccer group Derby County, however was unable to boost the cash and ultimately withdrew his supply.

“I imagine in transparency, belief, humility and respect for authority in enterprise,” he wrote in an open letter to Derby County supporters.

On the identical time, Slync, as soon as price $240 million, was late in paying its workers a minimum of six instances between April and June, in response to court docket paperwork. Workers have been apprehensive.

In August, Jason Selvidge, the corporate’s vice chairman of engineering from 2019 to 2022, sued Slync and Kirchner for not paying workers on time and wrongful termination.

In response to the lawsuit, Kirchner bought a Ferrari in April 2020 after the corporate had beforehand said that it was operating out of cash and was unable to pay workers. In response to the lawsuit, Selvidge and the corporate’s former CFO, Samar Kamdar, have been fired inside days after they expressed concern in regards to the firm’s funds in 2022.

The lawsuit alleges that Kirchner used firm funds as a private piggy financial institution and was an uninterested CEO, whom some workers known as a ghost for the way typically he went.

Guido dAmico, who joined the corporate as senior engineering director at Slync in December 2021, additionally joined the lawsuit. Kirchner has repeatedly stated that he resigned on July 1, 2022, as a result of he had not paid workers on time and had not been paid for practically two months.

Each former workers say they’ve overdue salaries due.

On July 24, 2022, Kirchner was suspended by the board. On July 26, Slync’s board legal professional alleged that, in response to court docket paperwork, Kirchner tried to delete sure digital data and ordered him to return firm gear. He was fired on 4 August.

The previous male worker, who spent three years on the firm, stated he was saddened by how issues have been going as Slync was happy with its creations. He stated the expertise has modified the best way he works.

At my new job, I say, present me proof, he stated.

In August, the FBI started investigating Kirchner and requested an arrest warrant on February 10, 2023. The company searched his 6,000-square-foot Westlake mansion on Valentine’s Day, which is estimated to be price $4 million. The warrant has been sealed, so it’s unknown what was seized.

What’s subsequent for Kirchner, Slync?

Slync did not appear to overlook Kirchner’s gross sales. Firstly of the 12 months, the corporate secured one other $24 million in financing led by Goldman Sachs, bringing the overall quantity raised by the corporate to over $100 million.

Darren Cohen, companion of Goldman Sachs, stated in his announcement in regards to the funding that the worth of the corporate’s know-how is important.

“In the course of the COVID pandemic, laden container ships anchored offshore and empty retailer cabinets confirmed everybody what occurs when the worldwide provide chain is disrupted.” We imagine that the Slync platform affords an modern resolution that strikes the worldwide logistics trade into a completely digital world.

Goldman Sachs spokesperson Mary Athridge declined to remark additional on Kirchner or the agency’s further funding in Slync. US Legal professional Basic’s spokesperson Erin Dooley and FBI spokesperson Melinda Urbina additionally declined to debate the case.

Kirchner was launched after his arrest, however he might not journey exterior of North Texas with out permission and talk with present or former Slync workers, traders, or prospects, in response to a court docket order figuring out the situations for his launch.

His trial will not be anticipated till a minimum of Might 6, 2024, in response to a joint timing report.

A former feminine worker of the corporate stated she wasn’t shocked to see Kirchner accused of fraud as a result of she at all times puzzled the place she bought sufficient cash for her huge purchases when workers had hassle getting paid.

Kirchner spoke of an enormous, spectacular sport that satisfied him to imagine in his imaginative and prescient and be part of his enterprise, however did not maintain it going.

“He did not actually look like he was main the corporate the best way a superb CEO would, and that is how I assumed he was after I first joined,” he stated. The entrance in some way shortly crumbled.