As a Tunisian human rights activist within the 2000s, Amira Yahyaoui organized protests and blogged about government corruption. IN interviews– she described being beaten by the police. When she was 18, she he saidshe was kidnapped from the road, taken to the border with Algeria and placed in exile for several years.
Ms. Yahyaoui’s fascinating background helped her stand out amongst entrepreneurs when she moved to San Francisco in 2018, where she founded a student aid startup called Mos. According to PitchBook, which tracks startups, the app topped the Apple App Store and Yahyaoui raised $56 million from high-profile investors including Sequoia Capital, John Doerr and Steph Curry. Mos was valued at $400 million.
In podcasts, television interviews and other media, Yahyaoui, 39, has often discussed Mos’s success.
Among others, She he said the startup has helped 400,000 students obtain financial aid. But internal company records reviewed by The New York Times showed that as of early last yr, only about 30,000 customers had paid for Mos’s student support services. Two people conversant in the situation said the remaining 400,000 users included individuals who signed up for a free account and will have received an email about applying for student aid.
After Mos expanded into online banking in September 2021, Ms. Yahyaoui told publications similar to: TechCrunch that the corporate had over 100,000 bank accounts. However, based on internal records, there have been very small amounts of cash in these accounts. Data shows that lower than 10 percent of Mos Bank’s roughly 153,000 users deposited their very own money into their accounts.
Some employees tried to talk out about Ms. Yahyaoui’s claims, said Emi Tabb, who worked in Mos’s operations department and, before resigning in late 2022, held positions including: financial aid director roles. But Ms. Yahyaoui fired and sometimes disparaged employees who tried to thrust back despite her public comments, said five individuals who witnessed the events.
“It has created a culture of fear” – Mx. – said Tab.
Mos belongs to a class of tech startups that emerged within the fast-money era of the late 2010s and early pandemic, when young firms received multimillion-dollar funding on little greater than guarantees. Now that the cash has run out and lots of tech startups are struggling within the recession, investors are more selective, customers are wary of daring claims, and employees are more suspicious of founders’ pronouncements.
Last yr, Mos laid off about half of its staff of about 50 and closed its banking services. The company returned to its original business of helping students find financial aid and started emphasizing the usage of artificial intelligence.
Ms. Yahyaoui referred inquiries to a spokeswoman for Mos, who declined to comment. When Ms Yahyaoui was asked about the variety of Mos users last yr, she replied: sent on social media that female founders were often found guilty and male founders innocent.
“Maybe today we should start applying the presumption of innocence to female founders as well,” she wrote.
Mos’s reporting was based on interviews with eight current and former employees, in addition to internal communications, presentations and evaluation. Internal documents are valid until 2023.
Ms. Yahyaoui grew up in Tunisia after which lived in exile in France. After moving to San Francisco, she raised money for Mos from investors including Expa, the investment firm founded by Uber founder Garrett Camp. Mos provided students with assistance find sources of monetary aid, charging $149 for every school yr.
Deena Shakir, an investor at Lux Capital who backed Mos in 2020, said she and the firm’s partners “deeply respect” Ms Yahyaoui.
“We are proud to support companies and founders like Amira, whose commitment to providing students access gives us hope for the future of higher education,” said Ms. Shakir.
Three individuals with knowledge of the corporate said Mos had a slow start. Some students who signed up learned about aid they already knew about, similar to the Cal Grant for California residents, they said.
An investor presentation viewed by The Times showed Mos had monthly revenue of $340,000 in December 2019. The startup allowed users to pay $1 upfront and the remaining $148 after receiving financial aid.
Mos didn’t find yourself collecting most of that cash. Seventy percent of users defaulted on their debts after the pandemic hit in 2020, Jess Lee, an investor in Sequoia who sits on the board of Mos, he later said in an article about the corporate published on Sequoia’s website.
At the tip of 2022, about 6,500 paying Mos customers, or 22 percent, had received refunds for the financial aid service, based on internal data. The company told customers that in the event that they didn’t receive five times the price of Mos’s services in financial assistance, they may receive a refund.
Mos he said it could help students access $160 billion in scholarships, but that quantity included loans, three people conversant in the situation said. The company’s goal was to assist students avoid debt.
MS. Yahyaoui Also he said students who used Mos “saved” a mean of $16,000. That’s the quantity the startup said it qualified for, not the help the students received, said three people conversant in the corporate.
Mosa website includes a moving bar of satisfied customers (for instance, “Jasmine got $12,237 for Cal Poly”). Ms. Yahyaoui asked employees to make use of stock photos and provide you with names, three people conversant in the corporate said.
Until 2021, financial technologies were very fashionable amongst investors. Mrs. Yahyaoui persuaded Mos to rework itself into a bank, which might make its financial assistance freed from charge. In September this yr, the startup announced its move into banking, offering people $5 to enroll and one other $5 for every referral.
Registrations were scattered. Mos turned off the $5 promotion on day one. Two months later, he turned it back on for 3 days and registered over 100,000 accounts, spending about $1 million on promotion and sending Mos to the highest of the App Store.
The registrations aroused interest from investors, including the investment company Tiger Global. Two people conversant in the situation said Ms. Lee of Sequoia desired to see what number of accounts registered through the promotion remained energetic before investing more. Sequoia encouraged Ms. Yahyaoui to rent a third-party company to evaluate whether the accounts belonged to real people, the people said.
Some employees also had concerns that lots of the accounts didn’t belong to real people, said three people conversant in the situation. As registrations continued, Mos analyzed the accounts for potentially fraudulent behavior in an internal working document. Two people said Ms. Yahyaoui restricted Ms. Lee’s access to the document in November.
Shortly thereafter, in February 2022, Tiger Global announced that it had provided $40 million in financing to Mos. Sequia joined the deal. It is unclear what impact access to the document would have on Sequoia’s decision to speculate more in Mos. Two people conversant in the situation said Ms. Lee retained access to a broader source of account data.
In a statement, Ms. Lee said: “The most successful founders are those who have the grit and are willing to test new hypotheses and adapt. Amira embodies these qualities.”
Tiger Global declined to comment.
In addition to the funding announcement, Sequoia published an article in your website detailing Ms. Yahyaoui’s dramatic past and entrepreneurial vision. It said lower than 1 percent of Mosa’s bank accounts had been closed, an “unheard of statistic for a money-based enrollment promotion.”
Few people used bank accounts, based on internal records reviewed by The Times. Of the roughly 153,000 accounts opened, 95 percent had lower than $5 in them and a third had zero balances by 2022, the information showed. Just 9.5 percent of account holders deposited money into their accounts during this time.
In a presentation seen by The Times, Mos told his board that 74 percent of checking account holders were students. But only about 20 percent were 22 or younger, and about 45 percent were over 30, based on internal data. Mos’s revenue from transaction fees, which made up the overwhelming majority of the corporate’s total revenue after becoming a bank, was lower than $70,000 in the primary nine months of 2022, two people conversant in the funds said.
According to 5 individuals who witnessed such events, Ms. Yahyaoui sometimes criticized her top managers and threatened to fireside them if their performance didn’t improve.
Using profanity, she wrote in a January 2022 message to employees that the corporate’s mission was meaningless “because of how bad we are at executing.”
“I need people I can rely on who will conquer my dreams, not bring them down,” she wrote.
Ms. Yahyaoui’s treatment of employees – including those based in Tunisia and Algeria – is contrary to her image as an activist, Mx. – said Tab.
Three people present said that in a September 2022 staff meeting, a Mos worker asked Sequoia’s Ms. Lee about her biggest concerns about the startup. Ms Lee initially said she was surprised by the great morale given the circumstances, then added it was unclear what the Mos product can be.
As Lee said, the startup was more prone to be within the “seed phase,” or very early stages of development.
