Key Points
- Robot startup Foundation has failed to pay employees since missing its Oct. 30 payroll, angering some workers after its CEO borrowed $4.6 million from the firm last year to buy a luxury home, according to people familiar with the matter.
- CEO and co-founder Sankaet Pathak is Foundation’s sole board member, raising governance concerns among prospective investors.
- Foundation’s widely reported $24 million in Pentagon contracts actually stems from its 2024 acquisition of Boardwalk Robotics, which held some existing government research contracts, the people said.
- Pathak’s previous company, Synapse, collapsed in 2024, leaving thousands of customers without access to deposits. Pathak reportedly took loans from Synapse as it neared bankruptcy.
So, let me be clear…
My employer will refuse even a salary advance (as in, getting it 2-3 days, maybe a week early), but the bossman can walk away with a “loan” of the company’s entire liquidity?
Looks like embezzlement to me. But “can” he get his hands on it? Yes.
I know here in Australia, it is legal for business owners to use their floating cash to loan to themselves, such as for an offset against their mortgage. If it is paid back in full before the end of financial year, then it’s fine. If not, it needs to be at marker interest rate and incurs taxes and porift distribution.
In this case, the loan is not the problem, but the not paying employees. Trading while insolvent is illegal and if they caused it by their loan, then they would and should face consequences. Usually fines. Since the new financial year in July, their superannuation (pension) must be paid within 7 days of payroll, so they’d be fined for that too.
As long as he pays off the republicans in charge…yes