But, when Destiny presented the first robot prototype in February 2023, 'It was a far cry from the socially intelligent 'humanoid' robot represented to investors'. — Reuters
The CEO of an AI robotics company that she ran out of a Miami apartment was better at hiding truths about the company’s progress, herself and where investor money got spent than guiding the company to produce the service robot it promised investors.
At least, that’s what an Securities and Exchange Commission complaint against Destiny Robotics and CEO Megi Kavtaradze claimed. Kavtaradze, legally, neither admits nor denies the accusations. And she refused comment when reached Sunday by phone.
Howeve, money talks. The case settlement approved Thursday by Miami federal court Judge K. Michael Moore says Kavtaradze agreed to pay the SEC a total of US$64,384 (RM280,665): US$12,990 (RM56,626) disgorgement, representing how much she profited from the “misrepresentations” in the SEC complaint; interest of US$1,394 (RM6,076); and a civil penalty of US$50,000 (RM217,962).
Though also listed as a defendant in the civil action, Destiny Robotics is a defunct company, so it faced no penalty or disgorgement.
The SEC complaint said in raising US$141,000 (RM614,654) from investors through crowdfunding, Kavtaradze and Destiny “made material misrepresentations” about:
– what Destiny Robotics products could do;
– when they would be released;
– touted “the completion of the hologram prototype while omitting that it had been abandoned;”
– “a major investor’s personal and business relationship with Kavtaradze while using his endorsement and role as stockholder;
– Kavtaradze being “an experienced executive from a technology company;”
– Kavtaradze misappropriating some investor money for personal use,” including “meals, travel and application fees for MBA programs.”
Kavtaradze’s LinkedIn page says she’s currently in an MBA program at University of California’s Berkeley campus. Despite being proudly trumpeted as Destiny’s Founder and CEO in 2021 and 2022 company social media posts, she doesn’t list Destiny Robotics among Experience on her LinkedIn page as of Sunday. But, she does list time with a “Stealth Startup” from July 2021 to August 2023.
That’s her length of time at Destiny Robotics.
Destiny and unfulfilled promises
The address on Destiny Robotics still-active website is 201 SE Second Ave, Monarc at Met, a downtown apartment building where Kavtaradze lived.
“I started Destiny Robotics to solve the problem of people feeling lonely,” Kavtaradze’s quote on the Wefunder page said. “My mission is to give everyone the humanoid home assistant.”
The SEC complaint said Kavtaradze, starting in July 21, used various media to tell possible investors that Destiny “was developing next-generation technology that would enable it to produce the world’s first humanoid robot capable of serving as an at-home assistant and companion.”
Destiny’s campaign on the Wefunder crowdsourcing site raised US$141,455 (RM616,637).
Both there and on the webpate, the SEC complaint said, touted Kavtaradze as an “experienced technology executive” and had been “responsible for managing large-scale projects and leading diverse teams.”
The SEC said, “In truth, Kavtaradze had no significant experience as an executive in a technology company rendering these statements materially misleading. Prior to Destiny Robotics, Kavtaradze never served as CEO or executive in a functioning tech company.”
Also, “Kavtaradze has since stated she did not have a background in technology other than what she taught herself.”
Destiny told investors they targeted 2022 for a humanoid hologram and a humanoid robot in 2023. But, when Destiny presented the first robot prototype in February 2023, “It was a far cry from the socially intelligent “humanoid” robot represented to investors. Rather, the actual “robot” was only a shoulder-up bust with a head capable of rotating with a white plastic shell lacking human facial features or hair...”
“The shoulder-up bust robot prototype did not have human-like skin, legs, or arms, and looked unlike what had been advertised to prospective investors or depicted in Destiny Robotics’ offering materials. It also did not feature cutting-edge AI as represented. Instead, it used AI software widely available for purchase in the market.”
A month earlier, Kavtaradze had applied to “six prominent MBA programs, using investor funds to pay the application fees.”
A TruCrowd crowdfunding offering got canceled after Kavtaradze learned in April 2023 that the Financial Industry Regulatory Authority was investigating Destiny.
Eric Morales, Julia D’Antonio and Russell Koonin handled the SEC’s investigation. Morales and Koonin handled the litigation. – Miami Herald/Tribune News Service
