Mithril Capital Tarnished by Federal Probe
September 26, 2019
This is a true or false situation.
You may be familiar with Peter Thiel, who co-founded PayPal and Palantir Technologies and has since used his billions to become a prominent venture capitalist. So prominent, in fact, that his involvement as co-founder helped Mithril Capital raise over $1billion. Now, though, Vox Recode reports. “The FBI Is Investigating a Venture Capital Fund Started by Peter Thiel for Financial Misconduct.” The investigation centers on Ajay Royan, Mithril co-founder who has a long history of working with Thiel. Though the probe is in its early stages, investigators have questioned individuals “close to Mithril” about possible financial misconduct. We’re told Mithril’s investors have complained in recent years that Royan failed to invest some of their cash in startups while collecting a fortune in fees for himself. Reporter Theodore Schliefer specifies:
“Mithril is likely collecting as much as $20 million a year in management fees, sources familiar with the figures have previously told Recode — an unusually large haul for a venture capital firm that each month has a smaller and smaller staff and therefore smaller and smaller expenses. (Mithril disputed the $20 million figure but did not provide an alternative.) At least 75 percent of the firm’s management company is owned by a Cayman Islands limited company that is, in turn, owned in excess of 75 percent by Royan, according to legal documents. So some of that money is going to Royan directly as salary. Those management fees go further in a low-tax state like Texas, where Mithril Capital said it was moving late last year. Several employees resisted the sudden move to Austin, which has a much smaller startup scene than Silicon Valley. Royan has said the move was rooted in his distaste for the Bay Area. But beyond that, two sources told Recode that Mithril leaders alluded to tax advantages when privately explaining the multiple reasons for the move. Mithril denied this.”
While denying any wrongdoing, Royan is sensibly cooperating with investigators. He also seems to be playing defense, offering uncharacteristic interviews at several financial and tech news outlets. Schliefer observes Thiel’s reputation is suffering from the association, though his direct involvement with the firm appears to be minimal.
The lengthy article shares some interesting details about the firm. Several staff members have recently bailed, for example.
Would an analysis of the available data with the Palantir Gotham system provide some insight?
Cynthia Murrell, September 26, 2019
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try to find mithril in toronto canada where they have an office in the medi in downtown
you even cant find a phone number …..