Valencia-based startup Jeff, which aimed to empower entrepreneurs across various industries, has recently filed for voluntary bankruptcy after facing significant financial challenges. The Spanish company has been grappling with payment issues for its employees for over nine months, resulting in the need for substantial downsising and a notable reduction in its workforce.
The Mercantile Court No. 2 of Valencia has appointed an administrator to oversee the bankruptcy proceedings, marking a pivotal development in Jeff’s uncertain future.
This news comes as a surprise, considering that just three months ago, Jeff reportedly secured €90 million in equity and debt funding from notable investors such as Delivery Hero-backed DX Ventures, Clean Ventures, Stelac, Prism, Nalpa, and Alcor. However, despite these funding efforts, the company failed to finalise agreements with two international funds. While the exact amount of debt remains undisclosed, reports suggest that it is expected to be significant.
€65M loss in two years
Jeff’s financial woes have been evident over the past two years, with the company incurring losses totaling approximately €65 million from 2020 to October 2022. This staggering figure emphasises the severity of the financial situation.
Unfortunately, this is not the first time Jeff has encountered such difficulties. In the past two years, the company had already implemented two workforce reduction plans (ERES), resulting in nearly 200 layoffs and over nine months of unpaid salaries.
On May 19, Jeff initiated voluntary bankruptcy proceedings through the Mercantile Registry, with the court approving the filing officially registered on the 26th of the previous month. To navigate the insolvency process, the court has appointed specialised law firm PKF Attest as the administrator. Jeff now faces critical decisions regarding potential liquidation or debt restructuring to address its mounting liabilities.
Meanwhile, unpaid employees have taken legal action, and their cases are currently under analysis by the 17th Social Court of Valencia.
Lawsuits in multiple countries
This challenging period is not the first time Jeff has faced turmoil. Over the past three years, the company has been embroiled in multiple lawsuits in countries such as Colombia, Mexico, Brazil, and its home country, Spain. Allegations primarily revolve around claims of a fraudulent scheme, with accusations that promised conditions, including achieving profitability within specific timeframes or generating orders through the app, were not fulfilled.
Founded by Eloi Gómez, Jeff initially aimed to provide tech solutions for entrepreneurs to launch and manage various businesses, including massage studios, coffee shops, fitness clubs, beauty salons, and coworking spaces. However, the company’s recent financial hardships have cast a shadow over its ambitious goals, leaving its future uncertain