‘Want to set the record straight’: Giga CEO alleges $3 million extortion demand from ex-employees

The San Francisco-based AI startup Giga is currently embroiled in a serious controversy following allegations from its co-founder and CEO, Varun Vummadi. He claims that a group of former employees is attempting to blackmail the company for a staggering $3 million in cryptocurrency. Vummadi, an alumnus of IIT-Kharagpur, took to social media to assert that this “small group of individuals” had unlawfully accessed sensitive company information to orchestrate their extortion plot. In his social media posts, Vummadi shared a screenshot of an email in which the perpetrators demanded payment in cryptocurrency, emphasizing that the matter has been reported to law enforcement. This crisis comes at a challenging moment for Giga, which successfully secured $61 million in Series A funding led by Redpoint Ventures just last November. Founded in 2023 by Vummadi and Esha Manideep, Giga specializes in creating voice-based AI agents for businesses and has quickly emerged as a key player in the generative AI landscape. On December 13, the company received its first extortion email from the anonymous group, which threatened to imprison both founders and demanded compensation that was said to be “10 times the value of the equities they stole.” In his post, Vummadi insisted, “Giga is being extorted for $3 million, and we want to set the record straight,” referring to numerous false claims circulating on social media. The email contained severe threats, warning that the least painful resolution would be to return what was allegedly taken, or face the gradual release of information from a so-called “70 GB destruction stack.” Just two days later, a former employee named Jared publicly asserted that he had obtained extensive internal data from ex-Giga workers, escalating tensions further. A subsequent email on December 23 reiterated the demand for $3 million, complete with detailed instructions on how to acquire Bitcoin and convert it to Monero, a cryptocurrency known for its privacy features. The email also suggested that the founders should liquidate personal equity to facilitate the ransom payment. The allegations of extortion coincided with a wave of accusations from Jared, who shared a viral thread on social media alleging various improprieties at Giga, including inflated revenue figures, misrepresentation of job titles and compensation, and a toxic work environment characterized by excessive work hours. Jared also recounted a troubling remark made by one of the founders, referencing a violent cultural practice. On December 25, Giga issued a statement firmly denying all allegations, labeling the emails as a coordinated effort to extort the company. “A small group of individuals has illegally obtained confidential company information and is now attempting to extort and blackmail Giga,” the statement read. The startup has notified law enforcement and expressed its intent to seek legal action, highlighting the anonymity of the emails as a significant factor in their claims of extortion.