- Founder Chris Kirchner was sentenced to 20 years in prison for using startup funds for personal use.
- Prosecutors contended Kirchner bought a $16 million private jet, among other extravagant purchases.
- The supply chain tech startup Kirchner founded, called Slync, shut down in October 2023.
Chris Kirchner, a startup founder convicted of defrauding investors, money laundering, and wire fraud, was sentenced to 20 years in federal prison Thursday after using $25 million of his funders' cash for personal use, according to court documents.
Kirchner, 36, founded a supply chain tech startup called Slync, raising more than $50 million from venture investors, including Goldman Sachs, between 2018 and 2021. According to the prosecutors, he transferred millions of the company's funding to himself in 100 separate transactions, funneled through multiple accounts. He also wired $20 million directly to his own checking account, according to the US Attorney's office in the Northern District of Texas.
In addition to prison time to be served in the Dallas, Fort Worth area, Kirchner was ordered to pay $65,415,938.12 in restitution. The judge did not hand down a fine as "the defendant does not have the financial resources or future earning capacity to pay a fine," according to the sentencing documents.
"Even as his company was circling the drain, Chris Kirchner was spending millions of his investors' money on himself," said Leigha Simonton, US Attorney for the Northern District of Texas, in an email statement. "Apparently, projecting personal prosperity was more important to him than making payroll. His duplicity earned him 20 years in prison. We are proud to hold him accountable for his crimes and are committed to pursuing all businesspeople engaged in criminal conduct."
In June 2022, some staff at Slync told BI they hadn't received their pay for weeks. At the time, Kirchner insisted the company was financially viable. In the weeks prior, he vied to purchase an English football club, Derby County, causing a stir among fans of the club on social media and in the sports press.
The startup also drew attention for participating in expensive sports sponsorships, including a five-year deal to sponsor the DP World Tour Desert Classic golf tournament, which is uncommon for a startup.
Kirchner eventually withdrew his offer for the football club and blamed his company's payroll issues on software providers. The golf deal was soon terminated as well.
Kirchner was suspended by his company's board in July 2022 and terminated the following month. The board appointed a new CEO, and the company attempted to recover but ultimately shut down in October 2023.
The FBI raided Kirchner's West Lake, Texas, home in February 2023. He was then charged with securities fraud and arrested. He was indicted in May of last year and further charged with defrauding investors in January 2024.
Kirchner's lawyers did not immediately respond to a request for comment.