AllHere Education: The $10M Fraud in EdTech by Joanna Smith-Griffin
AllHere Education, a Harvard-incubated AI startup led by founder Joanna Smith-Griffin, promoted “Ed”—an AI chatbot intended to reduce student absenteeism in school districts like LAUSD. Between late 2020 and mid-2024, she deceived investors by inflating revenue, cash reserves, and customer contracts. The company raised nearly $10M, but generated just $11,000 in real revenue and misappropriated $600K in funds. Arrested in November 2024, Smith-Griffin now faces charges including securities fraud, wire fraud, and aggravated identity theft, with potential sentences up to 42 years. AllHere filed for Chapter 7 bankruptcy in August 2024 and remains in liquidation.
Timeline of Key Events
Date | Event |
---|---|
Nov 2020–Jun 2024 | Misrepresented revenue, cash, and contracts to investors |
Spring 2021 | Claimed $3.7M in revenue and $2.5M cash; actual figures were $11K in revenue and $494K cash |
2021 | Raised approximately $8M in Series A; sold $750K in shares and embezzled $600K |
Jun 2024 | Furloughed most staff; bankruptcy proceedings filed in August 2024 |
Nov 19, 2024 | Arrested and indicted on fraud and identity theft charges |
Fraud Mechanics
- Inflated data: Claimed major school district contracts (LAUSD, NYC DOE, Atlanta PS) that never existed, and overstated finances significantly.
- Misuse of funds: Embezzled ~$600K for wedding and down payment on home via repeated small PayPal/Zelle transfers.
- Forged identity: Created a fake consultant email to send doctored financials and attempted to mask truth when discrepancies emerged.
Financial Overview
Claim by Smith-Griffin | Reality |
---|---|
$3.7M revenue; $2.5M cash | $11K revenue; $494K cash |
Nearly $10M funding raised | $600K embezzled; company unprofitable |
Contracts with major districts | None held beyond LAUSD's limited pilot |
Legal Proceedings
- Charges: Securities fraud, wire fraud (each up to 20 years), aggravated identity theft (2 years mandatory)
- Bankruptcy: Filed Chapter 7 in August 2024; trustee appointed; employees laid off
Impact & Lessons
- Investor Vigilance: Do not rely solely on founders—request audit-level proof of contracts and financials.
- Governance breakdown: Centralized control over communications allowed unchecked deception.
- Tech-skepticism in EdTech: As K‑12 AI adoption increases, so will scrutiny on product maturity before funding.