Spanish startup Jeff Jeff.com files for bankruptcy after failing to secure a €90 million round, hasn’t paid employees in 9 months

Jeff.com, a Spanish tech startup that provides entrepreneurs with a tech platform to run businesses with a mobile application to connect with customers, has filed for voluntary bankruptcy, according to a report first reported by Jesus Martinez at La Información.

Per the report, the Valencian, Spain-based startup decided to file for bankruptcy in the wake of multiple lawsuits from countries including Colombia, Mexico, Brazil, and Spain, substantial losses amounting to nearly €65 million, and the failure to secure a €90 million round. This includes a Series C round of financial infusion of  €45 million that failed to deliver and another debt-erasing payment of  €45 million that did not materialize. In the end, the eight-year-old Jef throws in the towel.

“The bankruptcy filing arrives after a €45 million Series C equity round, one that DX Ventures would have led with the participation of Clean Ventures, Stelco, Prism Venture Management, and existing partners including Nalpa and Alcor Ocean, led by the company’s chairman, Javier Rubió never materialized alongside a €45 million debt facility from an unnamed provider, however, the Central Bank of Dubai is mentioned as one of the investors,” La Información reported.

Regrettably, Jeff’s employees have been significantly impacted by the situation. According to the report, the company hasn’t paid employees for nine months. It failed to pay salaries since September of the previous year.

Eloi Gómez, who has not provided any comment in response to requests, reportedly attributed the payroll issues to the failure in closing the €90 million funding round. Gómez specifically mentioned the renegotiation of terms and a particular clause, as well as the Bank of Dubai’s intervention, which supposedly halted the outflow of capital. There is a pending lawsuit filed on behalf of the employees, highlighting their grievances and seeking a resolution for their unpaid salaries.

“The Valencian startup Jeff has filed for voluntary bankruptcy after accumulating more than nine months without paying its employees’ salaries and leaving its workforce at a minimum” La Información said.

During the announcement of Jeff’s Series C funding round, Gómez had expressed optimism, stating, “This investment operation not only resolves our current situation but also provides us with years of stability and ample capital to further develop our vision based on profitability.”

Interestingly, the announcement also introduced a new offering from the company called Jeff Capital. Launched in April 2022, Jeff Capital aimed to address the liquidity needs of Jeff’s customers. This situation raises concerns about the company’s decision-making, leading to speculation on whether it was a case of misguided actions taken by those in charge.

Meanwhile, the second Commercial Court in Valencia has appointed an administrator to oversee the process, following Jeff’s failure to secure a financing round with two international funds. The company had officially announced the funding round months ago but was unable to finalize the agreement.

While the exact amount of the company’s debt is yet to be determined, it is known to be significant. Between 2020 and October 2022, Jeff experienced substantial losses amounting to nearly 65 million euros. This appointment of an administrator marks a crucial step in managing the financial difficulties faced by the company.

Founded in 2015 by Adrián Lorenzo, Eloi Gomez, and Rubén Muñoz Trapote,  Jeff offers entrepreneurs a robust tech platform, accompanied by a mobile application that facilitates seamless interactions with customers. Its core mission revolves around eliminating financial and knowledge barriers for entrepreneurs, empowering them to thrive in their respective businesses. With a presence in 40 markets, Jeff’s solution has garnered the trust of over 2,000 entrepreneurs who rely on their innovative platform to run their businesses efficiently.