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A former business partner of SA entrepreneur Eran Eyal, who faces fraud charges in the US, has declined to comment on whether or not it was he who carried out pilot projects with two top US retailers — on behalf of Eyal’s present startup Shopin.
Eyal was due to appear in New York’s Kings Supreme Court – Criminal Term yesterday. He is charged with allegedly stealing $600 000 from investors by fraudulently soliciting investors to purchase convertible notes through false representations of his former company, Springleap. If convicted of the top count charged, he faces up to 15 years in prison.
Eyal, who is the co-CEO of retail blockchain startup Shopin, claims he is innocent and says he will comment “soon on everything”.
Meanwhile a storm is brewing over pilot projects he claims Shopin carried out with US retailers Bed Bath and Beyond and Zegna.
It comes after a spokesperson from Bed Bath and Beyond — public relations manager Leah Drill — last month told cryptocurrency publication CoinJournal (see their story here) that the retailer had “no record” of having done business with either Eyal, his present company Shopin — or his past company Passo. At the time the spokesperson told Ventureburn it also had no record of having done business with Passo’s former CEO Steven Gray (pictured above).
At the time of publication Ventureburn was still seeking comment from Bed Bath and Beyond on whether a third-party service may have been used or not. Ventureburn is still attempting to get comment from Zegna.
Last month a Shopin spokesperson — John Eddy, senior vice president of communications firm Goldin Solutions — said the startup could not “confirm or deny” the existence of the pilots “as indications several months ago that seemed to support their existence are being critically re-examined”.
Eddy said the pilots in question were undertaken by Passo, “a pre-cursor to Shopin”. It is understood that Eyal transferred the assets and investors from Passo to Shopin, when the latter was formed last year.
Said Eddy: “We do know that Steven Gray, CEO of Passo, had successfully secured a number of pilots during the lifespan of Passo, and purportedly these pilots were among them based on representations made by Mr Gray as well as other indicia.
“Unfortunately, however, we are not able to definitively confirm or deny the veracity of the existence of these pilots, as indications several months ago that seemed to support their existence are being critically re-examined,” he said.
Eyal has on numerous occasions claimed his company Shopin has done a pilot with Bed, Bath and Beyond.
In a presentation in April at the World Blockchain Forum in Dubai (see the video here) Eyal includes a slide that claims (at 4.50 minutes in the video) that the company carried out two 30-day pilots — with retailer Zegna and with Bed Bath and Beyond.
In the slide (see the below screenshot from the video) Eyal claims that the pilot with Zegna resulted in 130 000 signups, which helped the retailer to generate an additional $1.7-million in sales during that period. The pilot with Bed Bath and Beyond, he claims, netted 504 000 signups, which generated an additional $13-million for the retailer.
In an interview in March with On The Call: With The Crypto Insiders, Eyal claimed the two pilots helped the two retailers to achieve a 22% increase in the conversion rate of sales when the users shopped at Shopin’s Just for You page.
Earlier this month Ventureburn contacted Gray and asked him to comment on whether he had indeed run the pilots or not. Gray asked that he have time to consult with his attorney to ensure that he “not break the confines of my release from Passo Sync Inc”.
Gray mum on whether he conducted pilots
Responding a week later, Gray told Ventureburn that he had no affiliation with Shopin. “I do not have an equitable or financial interest in Shopin. I’ve never worked for a company focused on blockchain. If Shopin, or for that matter, any company, is referencing data and information external from itself, that is an issue in and of itself.”
Gray did not answer repeated calls from Ventureburn. On a subsequent request for clarification he stated only that he was bound by the confines of his release agreement from company and therefore “cannot address your questions”.
Ventureburn wants to know from Gray:
- Whether the pilots did indeed take place and if so, when they took place.
- Whether he could provide proof of an agreement with Zegna and Bed Bath and Beyond, such as a screenshot or the signed agreement itself.
- To name who he liaised with at Zegna and Bed Bath and Beyond.
- When and why he had opted to leave Passo.
- To comment on the legal case brought against himself, Passo and Eran Eyal by Amadeo Brenninkmeijer, in which Brenninkmeijer claims Eyal and Gray lied about having a carried out an 18-month pilot with retailer Macey’s. Ventureburn asked whether Gray did indeed carry out a pilot with Macy’s and if so, whether he had proof of this (again, a screenshot and the name of those he liaised with at Macy’s). Ventureburn also asked why he had not yet paid back the money Brenninkmeijer says Gray owes him as per the legal proceedings.
- To explain what the link is between Shopin and Passo and why Passo came to an end.
Ventureburn asked Brenninkmeijer to comment further on how the pilots were carried out, but weeks later he had not commented by the time of publication.
This is a developing story.
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Editor’s note (26 October 2018): In the question of space the name of the Bed Bath and Beyond spokesperson, public relations manager Leah Drill, was initially omitted. We have subsequently reinserted it.
Featured image: Former Passo CEO Steven Gray (via Facebook)