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IRL, the once-promising social app, has announced its closure following a startling revelation. An internal investigation conducted by the company’s board of directors found that a staggering 95% of IRL’s reported user base of 20 million was comprised of automated accounts or bots. The news comes as a significant blow to the company, which had secured over $200 million in venture capital funding.

IRL had positioned itself as a viable event organizing alternative for the younger generation, particularly Gen Z, who are increasingly turning away from platforms like Facebook. However, the company’s internal challenges became increasingly apparent despite raising a substantial $170 million in its Series C funding round led by SoftBank, valuing the company at $1.17 billion.

In a surprising turn of events, IRL had laid off approximately 25% of its workforce, amounting to around 25 employees, last year. This decision was unexpected, especially considering that the company had significantly expanded its team in the preceding year. In a memo to employees obtained by GreyJournal, former CEO and founder Abraham Shafi urged them to adapt and be disciplined, drawing comparisons to WhatsApp’s growth to 450 million users with a team of just 55.

Shafi’s memo contained several bold analogies, including likening the company’s aspirations to winning a gold medal in the Olympics, acknowledging the inherent challenges in achieving such distinction. However, the SEC’s subsequent investigation into possible violations of securities laws and growing doubts among IRL employees regarding the accuracy of the app’s claimed 20 million monthly active users cast a shadow over Shafi’s claims.

Amidst these developments, IRL’s board of directors took action in April, suspending Shafi from his position and appointing an acting CEO. The company’s financial situation remains uncertain, although an IRL spokesperson informed The Information that capital would be returned to shareholders.

Efforts to reach out to Shafi and other IRL employees by GreyJournal were unsuccessful, as their IRL email addresses have been deactivated. The downfall of IRL serves as a cautionary tale, shedding light on the prevalence of nonexistent users and the challenges faced by social media platforms in maintaining authenticity and trust among their user bases.