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Space startup’s founders linked to shady dating website ring

Space startup’s founders linked to shady dating website ring
Image: Firefly Aerospace

Two founders and board members of Texas space startup Firefly Aerospace appear to be involved in running a ring of sham dating websites, according to the results of a two-year investigation published by Snopes on Wednesday.

The investigation links the two men, Ukrainian businessman Max Polyakov and investor Mark Watt, to a handful of shell companies that appear to own and operate dozens of similar websites with names like “BuddyGays,” “MyLustyWish,” “WantMatures,” “Loveaholics,” “SpicyDesires,” and “AffairDating.”

After creating free accounts on a number of these websites, Snopes discovered they were filled with seemingly fake profiles, some of which used stolen photos of models. Snopes reports it was bombarded with messages attempting to convert its free accounts into paid subscriptions — ones that are allegedly hard to cancel. One expert Snopes spoke with said the pattern resembled what the Better Business Bureau calls a “subscription trap,” which is a potentially illegal gambit.

Firefly CEO and co-founder Thomas Markusic said in a phone call with The Verge on Wednesday that the spacefaring startup is “a completely independent entity,” and that while Polyakov’s venture fund is the company’s majority shareholder, the Ukrainian businessman is not involved in the day-to-day operations. He says he and Firefly are “not exposed” to any of Polyakov’s other businesses.

Firefly’s CEO says the startup is “completely independent” from Polyakov’s other businesses

“We have government contracts, and we’re just incredibly vigilant about being totally transparent and open with our shareholders and other stakeholders, our customers,” Markusic said. “We have a whole legal team that ensures we are compliant with all legal and ethical requirements for contracts with the government.”

Firefly Aerospace was founded in 2014 as Firefly Space Systems. The company set out to build the “Model T of rockets,” something that would be easily mass-manufactured, cost less than what SpaceX makes, but take smaller payloads to orbit.

Not long after it was founded, Markusic was sued by his former employer Virgin Galactic for allegedly using that company’s trade secrets to get Firefly off the ground. (The lawsuit was eventually settled.) Around the same time, a potential European investor backed out of a deal with Firefly in the aftermath of Brexit. The startup wound up filing for bankruptcy in early 2017.

Polyakov, through his Silicon Valley-based venture firm Noosphere, bought some of Firefly’s debt and then ultimately all of its assets. He started a new company called EOS Launcher, and then rebranded it to Firefly Aerospace, keeping Markusic on as CEO. After Polyakov put new money into the startup, it ramped up hiring, and not long after Firefly became one of nine startups selected by NASA to develop technology that could help put commercial payloads on the Moon. Firefly also took over a launch site at the Cape Canaveral spaceport in Florida, though it has yet to launch its first rocket. In January, a fire broke out at the startup’s facility in Texas during an engine test.

Polyakov and Watt are now credited on the company’s website as founders of the reformed company, Firefly Aerospace, and each took seats on the board. Watt also served as Firefly’s “acting chief financial officer,” though Markusic said he is no longer in that role.

“The Snopes article is incorrect. I am not involved other than my direct relationship with Firefly,” Watt said in a message on Wednesday. “I cannot comment on other things as they are wrong.”

In response, Alex Kasprak, the reporter who wrote the Snopes investigation, said in a statement to The Verge that “Mr. Watt is welcome to clarify what it is he thinks we have gotten wrong in reporting.”

“[Watt] was sent multiple emails detailing our claims in both January and February of this year and responded to neither,” Kasprak said. “We stand by our reporting.”

Polyakov did not respond to requests for comment.

Before swooping in and buying up Firefly’s assets, Polyakov had a history with dating sites, according to the Snopes investigation. For years, the Ukrainian businessman ran an online dating company called Cupid that was publicly traded in the UK. In 2013, though, the BBC published an investigation that alleged Cupid “seemed to use fake messages or profiles to entice people to subscribe.” Cupid eventually shut down in 2014, and according to Snopes, “sold its myriad dating websites to several offshore entities in the British Virgin Islands (BVI) and Malta.”

Polyakov has a history with sketchy dating sites

By examining court filings, public records, and information in the International Consortium of Investigative Journalists’ Offshore Leaks Database, Snopes says Polyakov was behind those offshore companies, and therefore retained his interest in them as he “moved to Silicon Valley and branded himself a player in the intersecting worlds of venture capital and aerospace tech” in 2016. Watt, who is one of Polyakov’s partners at Noosphere, is also listed on incorporation documents for some of the holding companies that own the dating websites.

In December, Markusic, Polyakov, Watt, and Firefly Aerospace were sued by some of the original co-founders and shareholders of Firefly Space Systems. Markusic and Polyakov were accused of collaborating on driving the original Firefly into bankruptcy so they could emerge with a new company that had fewer shareholders — claims that Markusic and others have denied in court filings.

Michael Blum, one of those original co-founders, told The Verge via phone that “Markusic was well aware that Polyakov had a sketchy background. And while more is known today, the basics of it were known to all of us at Firefly” a few years ago.

Markusic said he knew Polyakov “had been involved in a lot of dot com enterprises, one of which was dating,” but said he’s “never been privy to the details of what any of those companies are.” He also attempted to link the recent lawsuit with the Snopes investigation.

“If I were to speculate, and this is speculation, I don’t know for a fact, but I think the timing of the release of this article, which is intended to smear, and makes far-reaching statements about our involvement in government contracts, I don’t think its a coincidence that that litigation was recently launched and now we have these smear articles being launched at the same time,” Markusic said on the phone Wednesday. “I’d speculate there’s some connection.”

“Our reporting and this investigation’s release are unrelated to, and unmotivated by, any litigation Firefly Aerospace is involved in,” Kasprak said in response.

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