Augustus Intelligence Inc., which has received more than $100 million from investors since 2019, has filed for bankruptcy, a month after regulators had begun investigating its equity fundraising, the software developer said, WSJ Pro reported. The New York-based company said that one of the goals of its chapter 11 restructuring, filed Saturday in the U.S. Bankruptcy Court in Wilmington, Del., is to settle investor disputes. Brian Ryniker, recently hired as chief restructuring officer, said that in addition to unsecured debts totaling $2.1 million, there also are claims, which the company disputes, made by certain former employees. Augustus was co-founded in 2018 by Wolfgang Haupt to develop and license artificial intelligence software. Haupt is controlling founder, holding 68% of the company’s equity, Ryniker said. In 2019, Augustus raised $113.5 million from investors and was once valued at as much as $250 million, he said. The company initially used the funds to hire key employees, develop technology and invest in research and development. It has developed or acquired several patents and patents pending, Ryniker said in a court filing. Augustus also has made two acquisitions. Through subsidiaries that aren’t part of the bankruptcy, the company has roughly 30 clients. Ryniker said some employees were fired by prior management for breaching confidentiality and noncompete agreements. Prior management said they conducted a “smear campaign” against Augustus in the AI community, he added. The former employees last year sued Augustus, alleging they were “fraudulently induced” to join Augustus based on representations about the status of its seed funding and product development, Ryniker said.
