Give a Child $30 Million for a Startup, Keep Waiting for It to Start

Last week, Recode reported the departure of two more top executives from Clinkle, a San Francisco startup that's trying to create yet another way to transfer money with your phone. Investors have paid Clinkle tens of millions of dollars since 2011, and the company has yet to release a single product, while it keeps bleeding staff.

The turmoil might have something to do with the fact that the whole enterprise was put in the hands of an arrogant 21-year-old to begin with. According to two former employees and another source familiar with the company's operation, Lucas Duplan—now all of 22, with a reported $30 to $40 million in funding under his belt—is the reason that Clinkle is in disarray.

Duplan, one source says, is "very obviously a sociopath" who wears his expressions like a "mask." He is known to oscillate between unfettered geek anger and a contrived smile—perhaps still channeling Steve Jobs—creating an image as an "unsettling" boss. Add Peter Thiel to the mix as an investor, and you get a chief executive with a "prophet syndrome," as it was described to me. "He doesn't care about other people," this source added. "No one told him that you have to at least pretend to care about other people."

Guys who present themselves the way Duplan does are adored, almost ritually, and he knows it. But they're not necessarily good at their jobs.

"Everyone who is in charge now is not qualified to be in charge," laments one alum, saying that the weakness around him leaves Duplan free to constantly change his mind about what Clinkle should be or do. Instead of being a full-on Zuckerbergian boy-tyrant, the young CEO straddles an unproductive line between autocracy and absenteeism. He's known to spend his time in the office "just chatting with people," says one Clinkle alum, delegating responsibilities to an inner circle of Stanford classmates. When he's not being combative, Duplan has "hid in a room" for much of his tenure, leaving old white male ringers poached from other companies to take the occasional stab.

Those Stanfordites are considered special at Clinkle, creating a gulf between them and the rest of the struggling startup. "You could fuck over anyone except for Stanford kids," one source said. Duplan, having been hatched and funded by the university's faculty, is still a minor celebrity at Stanford and among alumni—though none of his professors-turned-investors would speak with me.

Inequity is part of how Clinkle runs. While underlings butted heads with Duplan over practical details about the new space, the boss was busy sketching his dream private office, filled with new hardwood floors, a personal secretary, and a custom-constructed desk. Meanwhile, former employees tell me the rest of the staff grumbled about low salaries, and got no severance, when it came to that.

It often has come to that, and Duplan doesn't just fire often, he fires clumsily. Rather than manage the staff he has, Duplan regularly runs through unhappy employees until he finds some that won't complain, "firing people until you get someone that's good." An entire team of customer-growth employees was terminated immediately after a jubilant staff party. Duplan is not subtle about his displeasure; he has openly referred to his business team as "a bunch of turkeys."

And after someone does leave, the company is "very aggressive legally," coercing them into silence and non-disclosure.

This is what the investors have bought so far, by giving tens of millions of dollars to an underdeveloped, over-inflated junior CEO: bad press, embarrassment, and a secret product that doesn't yet work. The people I spoke with doubt it will ever see the light of day.

But Clinkle exists in one of history's great vortices of willful delusion, where the prospect of complete failure is one more reason to get excited, and where experienced people line up to gamble on inexperienced ones. It's nonsensical, but not particularly surprising.