HeadSpin to Return Cash after Finding 'Irregularities'

Mobile app testing company HeadSpin is to return up to $95m in funding to investors after an internal review of irregularities forced it to restate its financials. In addition, the company has replaced CEO and co-founder Manish Lachwani with a new Chief Executive, Rajeev Butani.

Launched in 2015, HeadSpin uses automation, artificial intelligence and analytics to conduct testing, performance optimization and experience monitoring for thousands of different devices across more than 100 locations, in over 70 countries. According to online publication The Information, the firm is on track to report $15m in annual recurring revenue, and not the $100m it told investors in February.

An internal review commenced a month later was led by Chairman of the Board Nikesh Arora, and Karim Faris, General Partner of HeadSpin investor GV. The pair brought in KPMG to review financial statements dating from 2018 to the second quarter of 2020, and then forensic accounting firm Guidepost Solutions analyzed whether some of the company's transactions were deemed to be 'irregular'.

Having found the 'financial irregularities', the company said it would be returning up to $95m to investors, while lowering the value of its Series C stock by nearly 80%.

Web site: www.headspin.io .

All articles 2006-23 written and edited by Mel Crowther and/or Nick Thomas, 2024- by Nick Thomas, unless otherwise stated.