In a shocking turn of events, the social app IRL (In Real Life) has announced that it will be shutting down after an internal investigation found that most of its users were fake.
The investigation, which was conducted by IRL’s board of directors, found that 95% of the app’s reported 20 million users were “automated or from bots.” This means that the app’s user base was largely fictitious, and that only a small fraction of the users were actually real people.
IRL’s downfall is a cautionary tale for startups and investors alike. It highlights the importance of transparency and honesty in business practices, and the potential consequences of misrepresenting information to investors and the public.
IRL had previously raised more than $200 million in venture capital, and was poised to become an event organizing alternative for Gen Z, who are using Facebook less and less. However, the company’s valuation was based on the assumption that it had a large and active user base, which turned out to be false.
As a result of the investigation, a majority of IRL’s shareholders concluded that the company’s going-forward prospects were unsustainable and that it would be best to shut down. A spokesperson for IRL told The Information that the company would return its capital to shareholders.
IRL’s downfall is a reminder that even well-funded startups can fail if they are not careful about how they manage their finances and represent themselves to the public. It is also a warning to investors to be wary of companies that make unrealistic claims about their user base or revenue.
As the tech industry continues to evolve, it will be interesting to see how other startups navigate the challenges of building a real and sustainable user base. In an age of fake news and social media bots, it is more important than ever for companies to be transparent about their business practices and to build trust with their users.