Silicon Valley Hustle: Former Motionloft CEO Accused Of Defrauding Investors

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Thanks to a series of high-profile exits and a generally frothy financing environment, it’s not unusual to see startup founders spending money lavishly these days. But the story of Motionloft and its founder Jon Mills could serve as a cautionary tale, especially for unsavvy investors drawn to a big payout.

On the surface, Mills seemed like a successful entrepreneur. His company, Motionloft, provided real-world analytics for store and property owners who needed to analyze pedestrian and vehicle traffic that passed by their respective establishments.

Mills was a first-time entrepreneur, but he had received backing from high-profile investors like Mark Cuban, and according to the Motionloft website, the company had secured clients like CVS, Saks Fifth Avenue, and Cushman & Wakefield.

Several former friends say Mills was also fun to be around and generous about inviting them to party with him at various music festivals and in places like Las Vegas.

All of which is why, when Mills started asking friends if they wanted to invest in his company, a few of them jumped at the opportunity.

They say Mills cashed checks that altogether were worth hundreds of thousands of dollars, promising them a small percentage of the company. Later, when he told them an acquisition was imminent, they felt confident they had made the right decision.

Mills is no longer part of Motionloft, and the validity of the investments his friends made while he was there is being called into question by earlier investors. As a result, after months of waiting, those friends now believe that not only was there no acquisition, but that it is possible they won’t get any of their money back.

We’ve spoken with Mills, and the former CEO admits to leaving the company in November. But he also says that all money he took as investment from friends was legitimate and used for company expenses, and he denies telling friends the company was going to be acquired.

New Investors

It all started in early 2013. Around the time of the Super Bowl, sources say Mills told some friends he had a couple of Motionloft “advisor points” he could use at will, enabling them to buy a small percentage of the company. For some, he also dangled the possibility of an acquisition that would make the investment pay off.

“He told me, ‘Mark Cuban said to pick two good friends who could afford

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