A 12-year-old invite-only co-working and networking hub for startups has filed for Chapter 7 bankruptcy with nearly half a million dollars in total liabilities.
San Francisco-based Founders Den, launched in 2010, was created by Jonathan Abrams, Jason Johnson, Michael Levit and Zachary Bogue — a mix of entrepreneurs, startup founders and venture firm partners themselves.
"We want to create a community and create a place where we can work with each other," Johnson told the San Francisco Chronicle in 2011. Back then, they charged $500 per month for a single desk at their 8,500-square-foot office space in the South of Market neighborhood.
But the Founder's Den might have been undercharging, and they only accepted up to 15 startups at a time. The startups were also expected to leave after about six months.
“It’s a terrible business,” Johnson jokingly told TechCrunch in 2016. “If we wanted to make money on (the space), we’d lease it out to many more companies and charge a premium. … But that isn’t of interest to any of the four of us.”
Another five-plus years later, Founders Den has $423,380.68 in total liabilities, according to a bankruptcy filing. Nearly one-third of that, $136,600, is owed to the Small Business Administration which holds a lien on its assets.
The organization holds just over $80,000 in total assets, potentially leaving its sole remaining creditor, a real estate business listed as 655 Third Street Associates, out of luck.
Chapter 7 bankruptcy typically indicates a business expects to liquidate its assets, but it's unclear if Founders Den has shut down operations or if intends to do so in the future. The bankruptcy filing indicated that the organization did not own or lease any property, and the value of its brand, website and address was listed at $100.
News reports over the past 12 years have placed the Founders Den office in SoMa, but the bankruptcy filing indicates its "principal place of business" is currently at 548 Market St. in San Francisco.
Representatives for Founders Den did not respond to a request for comment.
Founders Den garnered some publicity, and controversy, in 2011 when then-Lt. Gov. Gavin Newsom rented a desk at the club for $500 a month.
It raised eyebrows not due to the cost but because one of the managing partners, Bogue, had contributed $12,000 to Newsom's campaign, the SF Chronicle reported at the time.
