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They informed employees of the shutdown as they were firing them. This was a few days AFTER they revoked the employees insurance benefits without notice or exp

They informed employees of the shutdown as they were firing them. This was a few days AFTER they revoked the employees insurance benefits without notice or explanation. Those same employees were also told that they're unlikely to get their final paycheck. As for me, I was suckered into pre-paying for $500 worth of classes that I'll never be reimbursed for. So many people who's livelihoods depended on their facilities were completely blindsided. Members who had been there for years were told they had hours to remove their belongings or they would be confiscated. The whole thing is a complete mess. All of this just a few weeks after opening a brand new location in Brooklyn. I simply can't comprehend the level of negligence and mismanagement here.

seattle_spring 9y ago
> I was suckered into pre-paying for $500 worth of classes that I'll never be reimbursed for. Did you pay with a CC? I would dispute the charges.
- chipperyman573 9y ago
  What could you dispute? You authorized the charges and received what you paid for (classes). That said, training (unless it's useful outside the job) must be paid for by the employer. For example a pool can require CPR training for their lifeguards because you can use that outside being a lifeguard, but Starbucks can't require you to pay for their class because knowing how to make a starbucks drink is too specific.
  - kylegordon 9y ago
    > I was suckered into pre-paying for $500 worth of classes that I'll never be reimbursed for. "pre-paying". He paid in advance, and the classes will now not be going ahead.
  - downandout 9y ago
    He didn't receive the classes he paid for, and yes, he can and should charge it back on that basis. You generally have 180 days to charge it back, so as long as the charge was within this time frame, his bank should reimburse him. They'll try to suck the money out of TechShop's bank account, and if the money isn't in their account, their merchant provider will become another creditor in the bankruptcy proceeding for the total amount of chargebacks.
  - Can_Not 9y ago
    He didn't receive what he paid for. The institution could have even accepted the money knowing they would not be rendering the service.
- thinkloop 9y ago
  Credit card companies retrieve disputed funds from merchants. If the merchant is under bankruptcy, I would guess the assets are inaccessible.
  - chimeracoder 9y ago
    > Credit card companies retrieve disputed funds from merchants. If the merchant is under bankruptcy, I would guess the assets are inaccessible. The cardholder still gets their money back. In bankruptcy situations, the entity that generally ends up eating the loss is one who processes the payments, not the merchant who sold them.
saluki 9y ago
ouch . . . no ins, no paycheck . . . at least try to protect your employees if you can.
- uncletammy 9y ago
  Yeah, that's my main point really. They failed to show even the smallest amount of consideration for the people who believed in them and what they were trying to build.
dehrmann 9y ago
Except for opening the new location, a lot of this is typical of bankruptcies.
- londons_explore 9y ago
  Opening a new location is sometimes a last ditch effort to save a company. With a new location, you get new staff who don't need paying till month end, new things to say to investors when looking for money, new opportunities to get the public to "sign up for a years membership in advance" to both help cashflow and make revenue look better to investors, etc.
deleted 9y ago
[deleted]
doikor 9y ago
> Those same employees were also told that they're unlikely to get their final paycheck. This as a Finn sounds crazy. Here the employees are protected to a degree if the company goes bankrupt then the government will pay the final paycheck and the government will be the first one to get their money back from the bankruptcy (before any banks/other creditors when any existing assets are sold)
- iagooar 9y ago
  This is what makes a European a European, and an American, American. We have different standards and expectations about the social contract between enterprises and society. Also, no wonder American companies tend to grow a lot faster without many impediments. The whole American system is built to support and protect the enterprise, not the people. In Europe, as an enterprise, you have a lot more requirements and obligations to fulfill. And even though I have a disadvantage running a company in Europe as compared to the US, as a European I believe it's the right thing to do.
  - scoggs 9y ago
    > This is what makes a European a European, and an American, American. We have different standards and expectations about the social contract between enterprises and society. As an American this is what I truly hate about corporations. They are afforded person-hood and "citizenship" where it benefits them but are treated as a company / corporation / non-living entity when that benefits them most. I've been tired of telling international friends that I don't set nor agree with the vast majority of American policies. I, sadly, have no faith that the day will ever come where I won't feel so defensive when the topic of my country and it's influence on the globe becomes the topic for discussion.
    - chimeracoder 9y ago
      > As an American this is what I truly hate about corporations. They are afforded person-hood and "citizenship" where it benefits them but are treated as a company / corporation / non-living entity when that benefits them most. As an American, I detest this meme, because it perpetuates major misconceptions about corporate law in the US. Corporations are not granted "personhood and citizenship". People are citizens. People can exercise their rights. Both of those statements are true whether they do so as individuals or whether they do so as a group. In other words, a group of people has the same legal rights collectively that they do as individuals. This concept is often abbreviated as "corporate personhood", which is unfortunate because it's a seriously misleading term. It's not that corporations become people - it's a way of referring to way individuals can exercise their rights through a group. Corporate personhood isn't even a single provision; it's a way of summarizing a collection of unrelated case law in a short phrase.
pitaa 9y ago
What was $500 in classes supposed to get you? It sounds like they were charging quite a bit for classes to make sure you knew how to not kill yourself on various equipment.
downandout 9y ago
This was a few days AFTER they revoked the employees insurance benefits without notice or explanation. There is somewhat of a saving grace here. Under federal law, these employees automatically qualify for a special enrollment period through the health insurance marketplace since they lost their employer-provided health insurance [1]. Since this happened during November, they can have coverage beginning December 1 as long as they sign up before the end of the month. [1] https://www.healthcare.gov/have-job-based-coverage/if-you-lose-job-based-coverage/ https://www.healthcare.gov/have-job-based-coverage/if-you-lo...
- ebbv 9y ago
  And how are they supposed to pay for it?
- uncletammy 9y ago
  True but it's hard to see the silver lining after being denied a prescription refill at the pharmacy and only finding out why when you turn up for work the following day.
  - bkanber 9y ago
    If you are denied a prescription refill because of an insurance lapse, you can get reimbursed for your out-of-pocket expense once you have insurance again. It's true that some people may not be able to pony up $100 for a refill, but if you do, you'll get reimbursed.
subpixel 9y ago
I checked the TechShop reviews on Glassdoor a month or so ago. While you have to put all such reviews through a b.s. filter of your own design, the overall impression was that the business was sinking and that management was wildly out of touch. Looks like some of that was accurate.
bambax 9y ago
> level of negligence and mismanagement That is the question... is it mismanagement, or is the business model fundamentally flawed and unworkable?
- Bartweiss 9y ago
  As I read it, the mismanagement is going broke before closing up shop. If the whole thing has been nonviable for a while, canceling insurance without notice and failing to issue final paychecks is a nasty thing to do.
- bagels 9y ago
  They had one store that was break even. Then they tried to go all silicon valley and take on as much investment and expansion as they could. They followed each unprofitable expansion with another one until they ran out of people to fool in to investing in their ponzi scheme. I say this having seen the investor prospectus. In 2009, they had one store that was break-even. The plan at that time called for opening "149" stores by 2015. By 2015, there were 2 out of 8 stores that were break even, the rest were money pits. If they stuck with growing slower and reinvesting profits, instead of taking on investments in an effort to make a unicorn, the bay area shops would still be open.
- johnneous 9y ago
  Both. An all-you-can-eat buffet with caviar wouldn't pencil out either, but that's what they wanted to create. $99/mo for access to $500K of machines doesn't work. Pay-as-you-go is the only way it works and this was presented to them multiple times. The licensing "pivot" was basically them telling other people to go lose money with their flawed business model.

seattle_spring 9y ago

> I was suckered into pre-paying for $500 worth of classes that I'll never be reimbursed for. Did you pay with a CC? I would dispute the charges.

chipperyman573 9y ago
What could you dispute? You authorized the charges and received what you paid for (classes). That said, training (unless it's useful outside the job) must be paid for by the employer. For example a pool can require CPR training for their lifeguards because you can use that outside being a lifeguard, but Starbucks can't require you to pay for their class because knowing how to make a starbucks drink is too specific.
- kylegordon 9y ago
  > I was suckered into pre-paying for $500 worth of classes that I'll never be reimbursed for. "pre-paying". He paid in advance, and the classes will now not be going ahead.
- downandout 9y ago
  He didn't receive the classes he paid for, and yes, he can and should charge it back on that basis. You generally have 180 days to charge it back, so as long as the charge was within this time frame, his bank should reimburse him. They'll try to suck the money out of TechShop's bank account, and if the money isn't in their account, their merchant provider will become another creditor in the bankruptcy proceeding for the total amount of chargebacks.
- Can_Not 9y ago
  He didn't receive what he paid for. The institution could have even accepted the money knowing they would not be rendering the service.
thinkloop 9y ago
Credit card companies retrieve disputed funds from merchants. If the merchant is under bankruptcy, I would guess the assets are inaccessible.
- chimeracoder 9y ago
  > Credit card companies retrieve disputed funds from merchants. If the merchant is under bankruptcy, I would guess the assets are inaccessible. The cardholder still gets their money back. In bankruptcy situations, the entity that generally ends up eating the loss is one who processes the payments, not the merchant who sold them.

saluki 9y ago

ouch . . . no ins, no paycheck . . . at least try to protect your employees if you can.

uncletammy 9y ago
Yeah, that's my main point really. They failed to show even the smallest amount of consideration for the people who believed in them and what they were trying to build.

dehrmann 9y ago

Except for opening the new location, a lot of this is typical of bankruptcies.

londons_explore 9y ago
Opening a new location is sometimes a last ditch effort to save a company. With a new location, you get new staff who don't need paying till month end, new things to say to investors when looking for money, new opportunities to get the public to "sign up for a years membership in advance" to both help cashflow and make revenue look better to investors, etc.

deleted 9y ago

[deleted]

doikor 9y ago

> Those same employees were also told that they're unlikely to get their final paycheck. This as a Finn sounds crazy. Here the employees are protected to a degree if the company goes bankrupt then the government will pay the final paycheck and the government will be the first one to get their money back from the bankruptcy (before any banks/other creditors when any existing assets are sold)

iagooar 9y ago
This is what makes a European a European, and an American, American. We have different standards and expectations about the social contract between enterprises and society. Also, no wonder American companies tend to grow a lot faster without many impediments. The whole American system is built to support and protect the enterprise, not the people. In Europe, as an enterprise, you have a lot more requirements and obligations to fulfill. And even though I have a disadvantage running a company in Europe as compared to the US, as a European I believe it's the right thing to do.
- scoggs 9y ago
  > This is what makes a European a European, and an American, American. We have different standards and expectations about the social contract between enterprises and society. As an American this is what I truly hate about corporations. They are afforded person-hood and "citizenship" where it benefits them but are treated as a company / corporation / non-living entity when that benefits them most. I've been tired of telling international friends that I don't set nor agree with the vast majority of American policies. I, sadly, have no faith that the day will ever come where I won't feel so defensive when the topic of my country and it's influence on the globe becomes the topic for discussion.
  - chimeracoder 9y ago
    > As an American this is what I truly hate about corporations. They are afforded person-hood and "citizenship" where it benefits them but are treated as a company / corporation / non-living entity when that benefits them most. As an American, I detest this meme, because it perpetuates major misconceptions about corporate law in the US. Corporations are not granted "personhood and citizenship". People are citizens. People can exercise their rights. Both of those statements are true whether they do so as individuals or whether they do so as a group. In other words, a group of people has the same legal rights collectively that they do as individuals. This concept is often abbreviated as "corporate personhood", which is unfortunate because it's a seriously misleading term. It's not that corporations become people - it's a way of referring to way individuals can exercise their rights through a group. Corporate personhood isn't even a single provision; it's a way of summarizing a collection of unrelated case law in a short phrase.

pitaa 9y ago

What was $500 in classes supposed to get you? It sounds like they were charging quite a bit for classes to make sure you knew how to not kill yourself on various equipment.

downandout 9y ago

This was a few days AFTER they revoked the employees insurance benefits without notice or explanation. There is somewhat of a saving grace here. Under federal law, these employees automatically qualify for a special enrollment period through the health insurance marketplace since they lost their employer-provided health insurance [1]. Since this happened during November, they can have coverage beginning December 1 as long as they sign up before the end of the month. [1] https://www.healthcare.gov/have-job-based-coverage/if-you-lose-job-based-coverage/ https://www.healthcare.gov/have-job-based-coverage/if-you-lo...

ebbv 9y ago
And how are they supposed to pay for it?
uncletammy 9y ago
True but it's hard to see the silver lining after being denied a prescription refill at the pharmacy and only finding out why when you turn up for work the following day.
- bkanber 9y ago
  If you are denied a prescription refill because of an insurance lapse, you can get reimbursed for your out-of-pocket expense once you have insurance again. It's true that some people may not be able to pony up $100 for a refill, but if you do, you'll get reimbursed.

subpixel 9y ago

I checked the TechShop reviews on Glassdoor a month or so ago. While you have to put all such reviews through a b.s. filter of your own design, the overall impression was that the business was sinking and that management was wildly out of touch. Looks like some of that was accurate.

bambax 9y ago

> level of negligence and mismanagement That is the question... is it mismanagement, or is the business model fundamentally flawed and unworkable?

Bartweiss 9y ago
As I read it, the mismanagement is going broke before closing up shop. If the whole thing has been nonviable for a while, canceling insurance without notice and failing to issue final paychecks is a nasty thing to do.
bagels 9y ago
They had one store that was break even. Then they tried to go all silicon valley and take on as much investment and expansion as they could. They followed each unprofitable expansion with another one until they ran out of people to fool in to investing in their ponzi scheme. I say this having seen the investor prospectus. In 2009, they had one store that was break-even. The plan at that time called for opening "149" stores by 2015. By 2015, there were 2 out of 8 stores that were break even, the rest were money pits. If they stuck with growing slower and reinvesting profits, instead of taking on investments in an effort to make a unicorn, the bay area shops would still be open.
johnneous 9y ago
Both. An all-you-can-eat buffet with caviar wouldn't pencil out either, but that's what they wanted to create. $99/mo for access to $500K of machines doesn't work. Pay-as-you-go is the only way it works and this was presented to them multiple times. The licensing "pivot" was basically them telling other people to go lose money with their flawed business model.