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Speaker 1: Decrypted is brought to you by red Hat, whose broad

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Speaker 1: portfolio of open source technologies for the enterprise helps you

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Speaker 1: get from where you are to where you want to be.

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Speaker 1: Red Hat the open technology to help you realize your vision.

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Speaker 1: Learn more at red hat dot com slash open tech.

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Speaker 1: Just over a year ago, Francisco Reordan was a twenty

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Speaker 1: seven year old software engineer, and he joined a venture

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Speaker 1: capital firm called Rothenberg Ventures. The company's founder, Mike Rothenberg,

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Speaker 1: was a young, charismatic Stanford University grad, and he was

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Speaker 1: known around Silicon Valley for throwing these extravagant parties. Francisco

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Speaker 1: had heard about his new employer's reputation, partly from a

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Speaker 1: skeptical story I wrote for Business Week back in At

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Speaker 1: the time, Francisco didn't think much of it. It made

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Speaker 1: me think it was a little bit risky, but um,

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Speaker 1: I still thought the company was making good investments based

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Speaker 1: on their portfolio, so I said, rush those concerns aside

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Speaker 1: and in retrospect. Uh, I shouldn't have done that. I

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Speaker 1: shouldn't have done that. Francisco says this because soon after

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Speaker 1: he joined, he started noticing some unusual things, things that

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Speaker 1: were raising his suspicions. The more he dug around, the

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Speaker 1: more he found. In just a few months in he

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Speaker 1: discovered something he thought was bad, maybe even against the law,

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Speaker 1: something that bothered him enough to take the very serious

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Speaker 1: step of secretly reporting it to government regulators. Yeah. I mean,

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Speaker 1: the internal debate was what will people think of me

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Speaker 1: for doing this? I felt, I'm pretty sure it was

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Speaker 1: the right thing to do, but you know, I thought

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Speaker 1: about what are the consequences to me personally if I

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Speaker 1: love the whistle? A week after Francisco filled out an

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Speaker 1: online form on the website of the SEC short for

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Speaker 1: the Securities and Exchange Commission, a lawyer from the Commission

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Speaker 1: got in touch with him. From there, Prince Cisco became

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Speaker 1: something of a double agent, providing the government information about

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Speaker 1: his employer. Francisco's actions set in motion a series of

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Speaker 1: events that ultimately brought down one of the venture capital

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Speaker 1: industries aspiring stars. In addition to being investigated by the

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Speaker 1: sec Rothenburg and his firm today is facing lawsuits from investors, creditors,

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Speaker 1: and former employees. Hi I'm Akio and I'm Adam Satriano.

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Speaker 1: And this week on Decrypted the whistleblower who secretly took on.

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Speaker 1: An ambitious venture capitalist is coming out, revealing his identity

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Speaker 1: and publicly speaking out about his experiences for the very

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Speaker 1: first time. Francisco said he decided to speak to us

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Speaker 1: in part to encourage others to take action if they're

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Speaker 1: seeing bad behavior at their companies. And Silicon Valley, where

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Speaker 1: corporate governance sometimes takes a back seat to growing fast

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Speaker 1: and making a name for yourself, employees are serving as

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Speaker 1: one of the industry's toughest checks. So, Adam, you wrote

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Speaker 1: a story about Mike Rothenberg and his VC firm. Back

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Speaker 1: in the headline was telling Lee Silicon Valley's party animal. Yes,

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Speaker 1: he did not like that. Yeah, I bet give us

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Speaker 1: some background about the guy. What got me interested was

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Speaker 1: you had this young venture capitalist. He had raised a

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Speaker 1: decent amount of money, and I had also heard the

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Speaker 1: story that he had first introduced Mark Zuckerberg to Instagram's founder,

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Speaker 1: Kevin's instroum. This was back when they were in their

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Speaker 1: college days. But more than anything, I had heard about

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Speaker 1: these events that he was throwing around San Francisco. Yeah,

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Speaker 1: can you give us an example. Well, my favorite was

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Speaker 1: these events that he had had that he called puppy

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Speaker 1: parties and they would rent out puppy is that people

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Speaker 1: could pet. But there was this other one they did

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Speaker 1: Quity called founders Field Day, and this was at a

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Speaker 1: T and T park where the San Francisco Giants baseball

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Speaker 1: team plays, and he branded the whole thing out, outfitted

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Speaker 1: it with virtual reality boosts and other thing for entrepreneurs

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Speaker 1: to come and play with. Yeah, this is the thing

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Speaker 1: that the HBO show Silicon Valley ended up parodying, right.

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Speaker 1: It was this perfect example of all the absurdity and

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Speaker 1: exuberance of the startup lifestyle. Richard, after your perfect game

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Speaker 1: at tech Crunch Disrupt a few weeks ago, we fell

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Speaker 1: in love with you and your tech. Look. We know

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Speaker 1: everyone in the valley is after you, and we know

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Speaker 1: that you're probably going to go with Peter Gregory, but

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Speaker 1: we'd love to have you come play on our team.

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Speaker 1: Let's Sternteller capital funding on your Series A financing, because together, Richard,

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Speaker 1: we'd be home run. And Rothenberg really seemed like a

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Speaker 1: character from the show. When I interviewed him for that

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Speaker 1: story in I sometimes wondered if he was putting me on.

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Speaker 1: He has a real gift for hyperbole, even by the

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Speaker 1: lofty standards of Silicon Valley. Here's a clip from a

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Speaker 1: talkie gave its Stanford a few years ago, and we

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Speaker 1: want to talk a little bit about blue oceans. So

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Speaker 1: when you're in a blue ocean, it means that it's

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Speaker 1: kind of a new market. It hasn't fully developed, and

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Speaker 1: people are I'm not yet sure where it's going to go,

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Speaker 1: but everybody wins because it's a blue ocean and everybody's

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Speaker 1: got the opportunities. And now back to red oceans. Rewind

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Speaker 1: what did you just say. In a blue ocean, everybody

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Speaker 1: can win. And the story we did wasn't a flattering profile.

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Speaker 1: That some former employees told me that Rothenberg made them

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Speaker 1: buy up all the week's issues a business week at

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Speaker 1: the airport so they wouldn't see him. But the firm

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Speaker 1: was doing just fine even after your story. Right. Yeah,

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Speaker 1: they aren't a big firm by any stretch, but they

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Speaker 1: were backing a lot of companies like the stock trading

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Speaker 1: app robin Hood, which is now valued at more than

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Speaker 1: a billion dollars. And it was with that backdrop that

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Speaker 1: Francisco joined Rothenberg Ventures to run their website and office

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Speaker 1: I T system. We recently visited Francisco at his one

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Speaker 1: bedroom apartment in one of San Francisco's residential neighborhoods. It's

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Speaker 1: in an old building built after the nineteen o six earthquake.

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Speaker 1: It's at the top of one of the city's many

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Speaker 1: large hills. Thanks. Thanks, I thought you like. He gave

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Speaker 1: us a quick tour. It's essentially a nerdy bachelor pad.

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Speaker 1: There was a big wayboard on one side of the

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Speaker 1: living room, which I've seen in the bedrooms of some

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Speaker 1: of my other friends who are engineers too. It's so

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Speaker 1: that they can write out their code by hands. Francisco

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Speaker 1: so had these three big computer monitors on his desk,

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Speaker 1: plus a few consoles to play his video games. And

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Speaker 1: he had these framed pictures of Apple's famous ad campaign

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Speaker 1: dubbed Think Different, featuring people like Picasso. His bedroom and

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Speaker 1: his kitchen were a little bit messy. Can I see

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Speaker 1: what's in your fridge? Oh, you're soilent drinker For our listeners,

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Speaker 1: Soilent is a drink made out of these different nutritional powders,

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Speaker 1: and it's really popular with coders who don't want to

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Speaker 1: spend time eating real food. Anyway. That's all to say

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Speaker 1: that Francisco is a lot like other young engineers in

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Speaker 1: Silicon Valley. He went to Stanford and the first job

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Speaker 1: he took straight out of school ended up getting bought

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Speaker 1: by the tech giant Cisco, not to be confused with

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Speaker 1: the nickname that Francisco goes by. And then with that

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Speaker 1: small amount of money he ended up making from that acquisition,

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Speaker 1: he started his own company that was an exchange for

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Speaker 1: betting on the price of bitcoin. This kind of options

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Speaker 1: market for bitcoin turned out not to be compliant with

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Speaker 1: federal regulations, so the government sent the letter to shut

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Speaker 1: it down, and he did not long after. In February,

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Speaker 1: Rothenberg Ventures hired Francisco. Rothenberg offered him a salary of

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Speaker 1: a hundred and thirty thousand dollars plus a thirty thousand

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Speaker 1: dollar bonus, and although he said the firm had scaled

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Speaker 1: back on some of those glitzier events, it still had

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Speaker 1: a luxury suite at the Basketball Arena where the Golden

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Speaker 1: State Warriors played. He went to the games and even

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Speaker 1: saw a Rihanna concert there once, all in the company's dime.

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Speaker 1: It was a sweet job for a young guy like Francisco,

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Speaker 1: but it didn't take him long to start to notice

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Speaker 1: some things. Well, the first red flag is actually my

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Speaker 1: first week on the director of finance, who was also

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Speaker 1: the head of clients quit. She just ran out. I

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Speaker 1: didn't know why. Nobody explained it to me, but that

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Speaker 1: was the first red flag. Was it clear that something

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Speaker 1: was weird was going on? It was clear that something

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Speaker 1: weird was going on, but I didn't know what it was.

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Speaker 1: I thought it might have been something personal or um.

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Speaker 1: One of the things I suspected was that it was

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Speaker 1: just like you broy an environment for Not long after,

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Speaker 1: Francisco said there was another troubling incident. Uh, there's a

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Speaker 1: growing incident. Somebody on the investment team grow up to

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Speaker 1: an executive assistant. Um might get it up, putting him

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Speaker 1: on unpaid leave for a while. And then um, he

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Speaker 1: came back shortly before everyone was put on you know,

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Speaker 1: let's go out basically where it was it? Where did

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Speaker 1: this happen? Just at the office or at the party?

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Speaker 1: It was a yeah party, It was actually Mike's birthday.

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Speaker 1: Everyone went out to a bar tonic con Pope and

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Speaker 1: lots of shots. Um. The growing thing happened kind of

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Speaker 1: r in the night. So that there's some early red flags.

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Speaker 1: But so you've cat your it got your suspicion zone.

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Speaker 1: But then you still you were still learning things. What

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Speaker 1: else where you learning? Yeah? So I had my initial suspicions. UM.

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Speaker 1: A whole theme throughout everything was just ridiculous spending UM,

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Speaker 1: and I like sports suites UM. And then I had

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Speaker 1: some additional suspicions UM. The whole time River STUDIOSUM was

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Speaker 1: in the same building. But Mike never really explained the

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Speaker 1: funding situation. Let me explain a little bit. In addition

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Speaker 1: to Rothenberg Ventures the VC firm, Mike has also set

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Speaker 1: up another business, a production company called River Studios that

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Speaker 1: made virtual reality videos, and he set up another business

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Speaker 1: on top of that called River Enterprises, which was another

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Speaker 1: way of investing in companies. Francisco says Mike owned a

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Speaker 1: major interest in these new businesses. They were supposed to

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Speaker 1: be separate from the venture capital firm that Francisco worked for,

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Speaker 1: which was managing other people's money. But Francisco was being

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Speaker 1: regularly asked to do work for the other businesses, and

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Speaker 1: that made him uncomfortable because he was supposed to work

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Speaker 1: for just the VC fund. I felt like I'd been

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Speaker 1: do by Mike. I felt like you know, I came

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Speaker 1: in to build this l people at all, to make

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Speaker 1: things it's easier for the LPs. That turned out he

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Speaker 1: was actually using it as you know, a way to

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Speaker 1: mislead the LPs, like one of the one of the

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Speaker 1: things that it was used for its sending out mass

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Speaker 1: emails with notifications about the annual reports, and these funeral

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Speaker 1: reports didn't tell the whole story. He left out big things.

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Speaker 1: Francisco had access to the company's I T system, so

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Speaker 1: he started doing some sleuthing. In a minute, we'll find

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Speaker 1: out what he discovered, But first a word from our sponsor.

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Speaker 1: Hat the open technology to help you realize your vision.

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Speaker 1: Before the break, Francisco had started noticing some things that

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Speaker 1: made him suspicious of the venture capital firm he just joined,

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Speaker 1: and he started poking around on top of the lavish spending.

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Speaker 1: Francisco would later discover internal documents that showed that the

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Speaker 1: management fees the VC firm had collected from its investors.

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Speaker 1: So this is the money specifically intended for operating the

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Speaker 1: fund was actually being used by the virtual reality companies

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Speaker 1: that Rothenburg was funding instead. I kept escalating and escalating. UM.

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Speaker 1: Also because I made the LP portal, I I asked

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Speaker 1: to upload annual reports, so I look at those, and

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Speaker 1: I'd see that these companies weren't disclosed them, Like there's

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Speaker 1: zero mention of River Enterprises in any of the annual reports. UM.

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Speaker 1: Zero I mentioned of River Studios and annual reports. UM.

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Speaker 1: Also so that you're concerned that investors didn't even know

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Speaker 1: that they were in sort of indirectly at least funding

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Speaker 1: some of these other activities. Exactly. Most people shrugged off

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Speaker 1: what they were seeing at Rothenberg Ventures. I spoke with

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Speaker 1: former employees who said that even though that they had

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Speaker 1: felt uncomfortable, nobody thought to step forward. And it might

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Speaker 1: sound like Francisco's nitpicking these tiny technical details here, but

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Speaker 1: I ran it by Andrew Touch, a professor specializing in

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Speaker 1: financial regulation at Washington University School Law, and he said

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Speaker 1: This sounds like a case of self dealing, which is

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Speaker 1: when a person who's supposed to be looking out for

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Speaker 1: the interests of investors instead takes advantage of his position

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Speaker 1: to benefit him or herself. Apparently the courts are pretty

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Speaker 1: strict about this, Andrew said, this fidciary duty is the

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Speaker 1: bedrack of finance of maintaining the trust between companies and

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Speaker 1: their investors. At the time that Francisco did and get

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Speaker 1: the benefit of that expert guidance, but he still felt

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Speaker 1: strongly that it was worth talking to the SEC. He'd

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Speaker 1: read up on the responsibility that a fund like Rothenberg

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Speaker 1: Ventures has two investors who have given it money, he

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Speaker 1: felt it could be fraud if Rothenberg wasn't using the

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Speaker 1: money in a way that he had told investors it

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Speaker 1: would be used. Once he made up his mind, Francisco

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Speaker 1: went to the agency's website SEC dot Go slash Whistleblower,

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Speaker 1: where there's a form to submit tips. It's a simple

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Speaker 1: questionnaire where you describe the complaint and give the government

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Speaker 1: some information about yourself, and there's a way to upload documents.

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Speaker 1: In the complaint, he listed examples of how he felt

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Speaker 1: funds were being misused so I submitted the forum. About

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Speaker 1: a week later, I got an email from the staff

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Speaker 1: attorney there. She asked me to go in. I went

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Speaker 1: in for one meeting at their San Francisco office. UM,

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Speaker 1: we talked about the forum. She had a print out

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Speaker 1: of the website which I had everybody's picture on it.

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Speaker 1: So we spent some time talking about each employee, what

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Speaker 1: their role was. It was, you know, like a nice

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Speaker 1: office building on Montgomery Street. It was just the two

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Speaker 1: of us in that conference room for that meeting, and

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Speaker 1: then later on in subsequent meetings or more people. Francisco

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Speaker 1: had a lot riding on this. He knew that coming

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Speaker 1: forward could cost him his job. If the SEC decided

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Speaker 1: to do nothing against Rothenberg would still be worth it.

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Speaker 1: Did you think that they could? You would be damaging

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Speaker 1: your career in your future. Yeah, I knew that to

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Speaker 1: some extent. I would be damaging my career. Why do

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Speaker 1: you say, thatt, I'm just so sure that it was

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Speaker 1: the right thing to do that, you know, Uh, it

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Speaker 1: was worth that price that I'd have to pay. After

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Speaker 1: that first meeting with the SEC, Francisco went back to

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Speaker 1: work like nothing was different. He began to live this

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Speaker 1: somewhat double life. While working like normal, he was also

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Speaker 1: corresponding with SEC sharing documents with them. Another information about Rothenburg.

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Speaker 1: Getting access to these documents wasn't difficult. Francisco was in

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Speaker 1: charge of it T at Rothenburg Ventures, so he had

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Speaker 1: access to all kinds of things that others didn't like

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Speaker 1: financial reports, email logs, and investor information. He'd copy them

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Speaker 1: onto a thumb drive and then send them to the

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Speaker 1: SEC via email later from his house. Did you feel

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Speaker 1: paranoying a little bit? Yeah, but I just didn't mention

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Speaker 1: it to anybody, and um, I didn't feel that different.

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Speaker 1: This double life didn't go on for long. A big

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Speaker 1: turning point came just a few days later when he

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Speaker 1: told the SEC that Rothenburg Ventures was making some changes

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Speaker 1: to its I T systems and some of the email

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Speaker 1: accounts were being deleted. This was in July of last year,

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Speaker 1: soon after the SEC sent an order to Rothenberg Ventures

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Speaker 1: telling them to not delete any records. It was the

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Speaker 1: first time that the firm knew it was in the

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Speaker 1: SEC's cross hands. And then Francisco got a message to

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Speaker 1: come to a meeting with two senior executives at the

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Speaker 1: firm Mike Rothenberg wasn't there. I was doing my work

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Speaker 1: and then one of them sent me a text message

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Speaker 1: and he said that he had an I T problem

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Speaker 1: that he needed help with, so could I make sure

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Speaker 1: I was in the office in a few minutes and

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Speaker 1: I said, yeah, sure, and then I think about half

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Speaker 1: an hour went by, and then he came by and

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Speaker 1: got me. I was sitting sitting out of couch in

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Speaker 1: the main office there, and then he took me um

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Speaker 1: into what was really Mike's office but wasn't in the

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Speaker 1: office that day, just a small office by itself off

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Speaker 1: that man room. And what happened? So his first question,

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Speaker 1: UM was he said, UM, so we've noticed that you've

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Speaker 1: been doing some government related searches and I didn't say

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Speaker 1: anything to that. And then he said did anybody tell

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Speaker 1: you to do that? And I said I'm not going

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Speaker 1: to answer that question. And then he said, well you're

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Speaker 1: terminated effective immediately, um, and then long awkward pause, and

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Speaker 1: then he said do you have anything to say? And

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Speaker 1: I said, um, I have some personal lot ends of

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Speaker 1: my desk a should grab and then he has started

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Speaker 1: me to get that stuff and then out of the building.

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Speaker 1: How did you feel after that, were you said, did

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Speaker 1: you cry? Were you angry? I was? I was angry,

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Speaker 1: like my heart was pounding. Um, it's mainly angry. Why

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Speaker 1: were you angry? That was unfair? Like you can't terminate

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Speaker 1: what's the blower? Like that? Um? And this was immediately

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Speaker 1: after they got a document preservation order from the SEC.

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Speaker 1: That's probably what that's probably that's why they're suspicious. The

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Speaker 1: SEC has declined to comment about the case, but tech

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Speaker 1: Crunch reported Rothenberg Ventures is being investigated for wire fraud,

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Speaker 1: bank fraud, and breach of fiduciary duty in law suits

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Speaker 1: from investors and employees. It's been alleged that Mike Rothenberg

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Speaker 1: used money intended for the startups for his own benefit,

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Speaker 1: it to support his own lifestyle, and Francisco learned from

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Speaker 1: emails he had downloaded from the firm that at one point,

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Speaker 1: Mike Rothenberg was paying himself about one million dollars, which

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Speaker 1: is a huge amount for a relatively small firm, but

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Speaker 1: Rothenberg was also struggling to manage it all. Last year,

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Speaker 1: Rothenberg needed to provide documents and tax information and some

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Speaker 1: return on investment to investors, and according to Francisco, and

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Speaker 1: some media reports the money wasn't there. Okay, so this

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Speaker 1: is a little bit complicated, but stick with us. The

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Speaker 1: records show that River Studios, which if you remember, is

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Speaker 1: one of the virtual reality businesses founded by Mike Rothenberg

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Speaker 1: this started, received two million dollars from an investor. The

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Speaker 1: same day, River Studios transferred one point seven million dollars

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Speaker 1: to Mike Rothenberg's personal account. Also on that same day,

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Speaker 1: Mike Rothenberg transferred once again one point seven million dollars

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Speaker 1: from his own account to the Rothenburg Ventures account. According

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Speaker 1: to Francisco, that gave Rothenberg Ventures the money to meet

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Speaker 1: the deadline of the other investors. By the way, that

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Speaker 1: investor who wired the two million has now sued Rothenberg.

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Speaker 1: The lawsuit alleges that Rothenberg co mingled the bank accounts

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Speaker 1: of his various entities, essentially treating the accounts of those

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Speaker 1: businesses as as personal accounts. By the second half of

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Speaker 1: last year, employees Quentin mass and a class action lawsuit

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Speaker 1: is working its way through the courts. It alleges that

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Speaker 1: staffers weren't paid. Another former employee has sued for more

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00:20:47,520 --> 00:20:51,760
Speaker 1: than a hundred thousand dollars that alleges Rothenberg didn't repay

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00:20:51,840 --> 00:20:54,280
Speaker 1: for business charges that have been put on a credit card.

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Speaker 1: American Express is also sued for unpaid charges. I knew

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Speaker 1: Mike Rothenberg a touch when I did that story back

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Speaker 1: in so I reached out to him about Francisco and

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Speaker 1: to get his side of the story. He didn't respond,

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Speaker 1: but a person who works for a New York PR

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Speaker 1: firm that specializes in crisis management and image rehabilitation reached out.

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Speaker 1: He told me Mike wouldn't be available for an interview

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Speaker 1: given the ongoing investigations in lawsuits Adam did the spokesman

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00:21:24,720 --> 00:21:28,520
Speaker 1: comment at all about Francisco where the allegations made by

349
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Speaker 1: him and in the lawsuits. He disputed Francisco's allegation that

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Speaker 1: he was fired for speaking with SEC. He said that

351
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Speaker 1: Francisco had already given notice that he was leaving. Francisco

352
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Speaker 1: says this is not true. The spokesman also pointed out

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Speaker 1: that Francisco had this run in with authorities for the

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Speaker 1: bitcoin exchange. He was implying that undermines his credibility. But

355
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Speaker 1: what about the core allegations about misusing money. The spokesman

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Speaker 1: declined to comment about the specifics. But Rothenberg did post

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Speaker 1: a Facebook law I video earlier this year to explain.

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Speaker 1: So one of the things that I just wanna answer

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00:22:06,560 --> 00:22:08,720
Speaker 1: head on which I which I have done to the press,

360
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Speaker 1: but they have not published it, and I want to

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Speaker 1: be sure I'm very clear about this is the question

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00:22:13,880 --> 00:22:17,359
Speaker 1: I've had is you know, have you taken any money improperly?

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Speaker 1: And the answer is no. And I've said that before

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Speaker 1: and and uh it continues to that message continues to

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Speaker 1: knock it out. There is clearly as it should. And

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Speaker 1: another one is that have we made any investments without

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Speaker 1: investor permission? We haven't. We have not made any investments

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Speaker 1: without investor permission. For those kinds of rumors going quickly,

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00:22:34,640 --> 00:22:38,080
Speaker 1: there has to be very responsible reporting and um, there

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Speaker 1: has to be fair and balance reporting. And there's a

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Speaker 1: very big um. There's a very big weight on the

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Speaker 1: shoulders of reporters because those um that particular group of people.

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Speaker 1: The video goes on and in it he spends a

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Speaker 1: lot of time blaming the media for bias coverage. Adam,

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Speaker 1: you spoke to a few professors to better understand what

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Speaker 1: kind of trouble that Mike Rothenberg and his firm might

377
00:23:00,760 --> 00:23:03,439
Speaker 1: be in What I learned is the SEC has been

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00:23:03,480 --> 00:23:07,480
Speaker 1: pretty vigilant in protecting whistleblowers, including bringing actions against those

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Speaker 1: who retaliate. So that means it will be pretty difficult

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Speaker 1: for Rothenberg to come after Francisco for going to the SEC. Yeah,

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Speaker 1: and I also learned that Rothenberg could be in hot water,

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Speaker 1: especially for what appears to be mismanagement of funds. Like

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Speaker 1: we talked about earlier, fidiciary duty is the bedrock of finance.

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Speaker 1: It's that trust between an investor and a person like

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Speaker 1: Rothenberg who's investing that money on their behalf. Do you

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Speaker 1: think there's a risk of jail time here? People I

387
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Speaker 1: spoke with didn't think so, but there's definitely a possibility

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Speaker 1: of financial penalties. And even beyond that, Mike Rothenberg's reputations

389
00:23:44,080 --> 00:23:48,080
Speaker 1: and tatters. Now that's right, and Rothenberg was this really

390
00:23:48,119 --> 00:23:52,159
Speaker 1: ambitious venture capitalist, but now that the firm is a

391
00:23:52,200 --> 00:23:55,400
Speaker 1: bare bone staff and the reputation has really been hurt.

392
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Speaker 1: In addition to speaking with the SEC, Francisco also began

393
00:24:01,920 --> 00:24:05,320
Speaker 1: communicating with a few journalists about what he'd been finding

394
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Speaker 1: at Rothenburg, under the condition that they wouldn't name him.

395
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Speaker 1: At that point, while the firm's big spending and lavish

396
00:24:12,600 --> 00:24:16,320
Speaker 1: events were well known, the internal turmoil had been largely

397
00:24:16,359 --> 00:24:19,160
Speaker 1: kept under wraps. But in the months after that, several

398
00:24:19,320 --> 00:24:23,800
Speaker 1: very tough stories came out chronicling Rothenberg's questionable management of funds.

399
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Speaker 1: Francisco says that he never regretted the decisions he made,

400
00:24:28,600 --> 00:24:31,560
Speaker 1: but it did take a toll. After he says he

401
00:24:31,600 --> 00:24:34,080
Speaker 1: was fired, he made a last minute decision to join

402
00:24:34,200 --> 00:24:36,600
Speaker 1: some friends going on a seven day hike in Sweden.

403
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Speaker 1: On the walks, he talked about the ordeal with Justin Chen,

404
00:24:40,600 --> 00:24:44,520
Speaker 1: a friend who's also a software engineer. It's sort of that,

405
00:24:44,400 --> 00:24:47,480
Speaker 1: and I realized that, oh, he wants to leave this

406
00:24:47,600 --> 00:24:51,920
Speaker 1: city because he's worried about this. The Splice he was

407
00:24:51,960 --> 00:24:56,240
Speaker 1: working at where he was terminated. Uh, I got the

408
00:24:56,240 --> 00:24:59,320
Speaker 1: sense he was worried about it about like Mike Rothenberg

409
00:24:59,359 --> 00:25:03,320
Speaker 1: coming after him for a while, like physically. Justin says

410
00:25:03,359 --> 00:25:06,280
Speaker 1: that even though this hasn't been easy for Francisco, he's

411
00:25:06,280 --> 00:25:09,760
Speaker 1: in a much better position than most software engineering jobs

412
00:25:09,760 --> 00:25:12,479
Speaker 1: are in big demand, and he'll likely have an easier

413
00:25:12,520 --> 00:25:16,840
Speaker 1: time finding another job than somebody else might at Francisco's apartment,

414
00:25:16,840 --> 00:25:20,439
Speaker 1: there's a messy bookshelf with some tea packets, notebooks, a

415
00:25:20,480 --> 00:25:23,720
Speaker 1: few fantasy books, and on the top shelf we found

416
00:25:23,720 --> 00:25:27,359
Speaker 1: one called The Whistleblower's Handbook, a step by step guide

417
00:25:27,359 --> 00:25:31,280
Speaker 1: to doing what's right and protecting yourself. Francisco said that

418
00:25:31,359 --> 00:25:34,080
Speaker 1: he actually found the book only after he had gone

419
00:25:34,119 --> 00:25:38,159
Speaker 1: through this whole experience of being a whistleblower himself, and

420
00:25:38,200 --> 00:25:40,040
Speaker 1: he said he wished that he had read the book

421
00:25:40,119 --> 00:25:44,600
Speaker 1: before approaching the SEC. Now he thinks more people will

422
00:25:44,680 --> 00:25:47,960
Speaker 1: be coming forward in Silicon Valley. He says he hopes

423
00:25:48,000 --> 00:25:51,280
Speaker 1: to inspire others to step up. Part it's a critical

424
00:25:51,320 --> 00:25:53,679
Speaker 1: mask thing. Once you have a few of those stories

425
00:25:53,720 --> 00:25:55,520
Speaker 1: out there, it's easier for more people to do it.

426
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Speaker 1: And then also I think that people are getting more

427
00:25:59,400 --> 00:26:03,800
Speaker 1: fed up with the treatment, Like I feel like Silicon

428
00:26:03,880 --> 00:26:05,880
Speaker 1: Valley is more unethical now than it was a few

429
00:26:05,960 --> 00:26:09,280
Speaker 1: years ago. People are responding to that. And what why

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Speaker 1: why do you think that? Um? I feel like, just

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Speaker 1: because Silicon Valley's doing so well, it's attracting, you know,

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Speaker 1: more more bad people who wouldn't have come here ten

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Speaker 1: twenty years ago. People who were in it for the money,

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Speaker 1: people in it for the easy money. Yeah. Francisco is

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Speaker 1: now eight and he's working on a startup idea and

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Speaker 1: email security program for businesses. He continues to work with

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Speaker 1: the SEC and says he's available to be a witness

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Speaker 1: in any of the lawsuits pending against Rothenburg. He also

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Speaker 1: says he's been applying for some jobs. He's invariably asked

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Speaker 1: about his experience at Rothenburg. In one instance, he told

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Speaker 1: them about his role blowing the whistle just to see

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Speaker 1: what the response was. He said there was a bit

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Speaker 1: of nervous laughter, and then he didn't get a call back.

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Speaker 1: And that's it for this week's Decrypted. Thanks for listening.

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Speaker 1: If you work at a company where you suspect wrongdoing,

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00:27:13,760 --> 00:27:16,040
Speaker 1: get in touch with us. You can record a voice

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Speaker 1: message and send it to Decrypted at Bloomberg dot net

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Speaker 1: or I'm on Twitter at Satriano send me a direct message,

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Speaker 1: and I'm at Akio seven. If you haven't already, please

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Speaker 1: subscribe to our show wherever you get your podcasts. While

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Speaker 1: you're there, please leave us a rating and a review.

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Speaker 1: This really helps more listeners find their show. This episode

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Speaker 1: was produced by Pio Gadkari, Liz Smith, and Magnus Hendrickson.

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Speaker 1: Thanks to Nico Grant, who helped with some of the

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Speaker 1: research for today's show. Jeff musc has edited my story

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Speaker 1: about Francisco for Business Week. Alec McCabe's head a Bloomberg

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Speaker 1: podcast We'll see you next week. Decrypted is brought to

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Speaker 1: you by red Hat, whose broad portfolio of open source

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Speaker 1: technologies for the enterprise helps you get from where you

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Speaker 1: are to where you want to be. Red Hat the

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Speaker 1: open technology to help you realize your vision. Learn more

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Speaker 1: at red hat dot com, Slash open Tech,