Few and Far: The $10M DJ Fund

DerekHey, welcome back to Vaporware.

GrantRound two, baby. Let's go.

DerekOh man, wait till you hear where this money went.

GrantHit me.

DerekTen million dollars. And Fortune reported some of it landed on a Miami condo, casino nights, and get this, a DJ hobby.

GrantA DJ hobby with investor cash?

DerekInterior decorator too. Full redesign.

GrantFor an NFT marketplace?

DerekFor an NFT marketplace that may have never really launched.

GrantOkay, that's the funny part. What's the part that should make people mad?

DerekThere was an internal audit that reportedly caught the diversion years before any charges came down.

GrantAnd the company just kept going?

DerekKept going. Wait, somebody flagged it, and everyone just let it ride? Yeah.

GrantPicture this. The token eventually launches, drops ninety-nine percent, and the website still calls it live.

DerekOh, we'll get there.

GrantWe're also getting into how a big-name investor let sixty-seven people skip their own homework.

DerekAnd how the founder allegedly got locked out of his own wallet, then fired the people who locked him out.

GrantThe math doesn't work, and everyone knows it.

DerekSo let's open the file. Okay, so the indictment's got line items that read like a receipt from the worst weekend in Miami.

GrantHit me. What's on it?

DerekOnline casino gambling, speculative crypto trades, a loan payment on a Miami condo, interior decorating, and wait for it, DJ gear.

GrantDJ gear. Like actual turntables?

DerekThe indictment doesn't specify the brand, but yeah. That's allegedly where investor money went instead of building the NFT market it was raised for.

GrantOkay, how much money are we talking here?

DerekTen million dollars, according to Fortune's report today, from sixty-seven investors.

GrantTen million for casino chips and a condo?

DerekAllegedly. This is Taj Tarsha, thirty-four, founder of a startup called Few & Far. SDNY unsealed the indictment Wednesday, one count securities fraud, one count wire fraud. Twenty years max on each.

GrantWow. And he's just walking around right now?

DerekOut on a five hundred thousand dollar bond per Crypto.news' coverage. He was arrested back in June.

GrantFeels small next to some of the crypto disasters we've covered.

DerekFunny you say that. The case landed in front of Judge Lewis Kaplan, same judge who sentenced Sam Bankman-Fried.

GrantNo way. Same courtroom, basically.

DerekAnd the number here is roughly one eight-hundredth of the FTX total.

GrantSo it's the tiny cousin of the trial we all remember.

DerekEveryone's presumed innocent. Nothing's been tested in court yet. But the spending list isn't actually the interesting part.

GrantWhat is?

DerekAn internal audit allegedly caught this back in June of twenty twenty-three, and the company kept running for another year after that.

GrantWait, they caught it and just kept going?

DerekThat's the part I keep running into with these stories. Detection was never the hard part. So if the alarm went off in twenty twenty-three, where did the ten million even come from to begin with? With that in mind, let's rewind to February twenty twenty-two. That's when this whole thing actually starts.

GrantPeak Bored Ape season, right? Everybody's got a cartoon monkey as their profile picture.

DerekThat exact era. Tarsha and two co-founders, Chris Gale and Chris Hayes, incorporate Few & Far in the British Virgin Islands. CoinDesk reports they're building a decentralized NFT marketplace on NEAR Protocol.

GrantNEAR Protocol. For the rest of us, what is that?

DerekFor the non-crypto listeners in the audience, think blockchain competing with Ethereum, faster and cheaper. NEAR had its own token ecosystem, and Few & Far wanted a piece of it.

GrantOkay, and the money comes in how exactly?

DerekSAFTs, Simple Agreement for Future Tokens. You wire money now for a token that might exist later under paperwork that says funds go toward development and, quote, "legitimate corporate expenses."

GrantSo I'm buying a coupon for a coin that doesn't exist. Heh. Had to say it.

DerekHeh. These sold under Regulation D, so only accredited investors, people the SEC figures can handle the risk.

GrantWhich is the whole defense, right? You signed the paperwork. You're sophisticated.

DerekRight. And here's the part that got me.

GrantWow.

DerekThe indictment and Fortune's reporting both point to the diversion starting almost immediately.

GrantWait, immediately? Not after the NFT market crashed?

DerekImmediately. Money lands in February. Personal spending starts before there's a product to point to.

GrantSo there's no the dream died, then he panicked story.

DerekThe gap opens on day one.

GrantWhich raises the real question. If you're one of those sixty-seven investors, what recourse do you actually have? A SAFT isn't equity. No board seat, no audited financials.

DerekYou get a promise and a signature. That's the structure.

GrantTerrifying.

DerekAnd that same thin structure is exactly what let one big-name investor make the next round feel safe for everyone else.

GrantAh, the credibility problem again.

DerekSo building on that check-writing spree, a year later, the same company lands its real credibility moment.

GrantWait, this is the Pantera thing? March twenty twenty-three, a ten point five million dollar seed round, and Crypto.news reported Pantera Capital led it.

DerekPantera, as in one of the biggest names in the entire crypto investing world?

GrantCypher Capital, Hypersphere, K5 Global, all reportedly in the round too, according to Crypto.news.

DerekSo a company that's already allegedly bleeding cash just gets more money?

GrantThat's the part that gets me. When a name like Pantera leads, nobody underneath double-checks the plumbing.

DerekWait, back up. Why not? They've got analysts, teams, spreadsheets.

GrantBecause they're not underwriting the business anymore. They're underwriting the brand sitting at the top of the cap table.

DerekHuh.

GrantIt's like buying a used Ferrari off of somebody else's inspection report. You never popped the hood yourself. You just trusted the name that signed off. And if that inspector missed something, everyone downstream inherits the mistake, every single time.

DerekOkay, but here's my question, and it's the one nobody in this story seems to ask out loud.

GrantGo.

DerekI hate to be this guy, but did the marketplace actually work? Few&Far is an NFT platform. Could you log in and mint something?

GrantThat's a great question, and I don't know the answer.

DerekBecause that's the pattern we keep hitting on this show. The money moves before anyone confirms the product exists. The round-

GrantRight

Derek... announcement becomes the proof.

GrantAnd I wanna be careful here. The indictment doesn't name the investors who got burned.

DerekRight, so we can't just draw a straight line from Pantera-led around to these specific people lost money.

GrantWe can't. That connection isn't in the court filing. It's worth saying out loud instead of implying it.

DerekFair, but the sequence still stands. SAFTs in twenty twenty-two, a marquee seed round in twenty twenty-three, and allegedly zero product to show for either.

GrantAnd six months after that Pantera round closes, somebody inside the company finally runs the numbers.

DerekWait, the audit?

GrantJune twenty twenty-three, and this time the controls actually work.

DerekAnd someone checked?

GrantSomeone checked.

DerekBuilding on that gap, Crypto.news reports an internal audit in June twenty twenty-three allegedly found about one point two million dollars-

GrantWow

Derek... in undisclosed bonuses.

GrantWait, an actual audit? Somebody looked?

DerekSomebody looked. Two names came up, Tarsha and a co-founder. The co-founder reportedly returned around six hundred thousand dollars.

GrantAnd Tarsha?

DerekAccording to Crypto.news, he didn't return a cent.

GrantOf course not.

DerekTarsha allegedly told investors those bonuses were tied to preset FAR presale milestones, that every dollar was still going into the project.

GrantWhile knowing what exactly?

DerekWhile allegedly telling people privately the company had zero revenue.

GrantUgh. So the pitch to investors and the truth in his own head were two different documents.

DerekAllegedly, yeah. And after the audit, prosecutors say personnel pulled Tarsha off the multisig.

GrantMm-hmm. For those of us who don't live on crypto Twitter-

DerekA multisig needs multiple signatures to move money. Picture a vault that takes three keys, not one. Pull somebody's key-

GrantRight

Derek... they're locked out.

GrantSo they locked him out.

DerekThey locked him out, and allegedly, he responded by firing the two people who controlled the wallet, then threatened litigation unless the remaining assets moved to an account he controlled.

GrantWait. Wait, wait, wait. So the alarm went off, the audit, the lockout, and it still didn't matter?

DerekIt didn't matter.

GrantThat's what gets me. Somebody caught this in real time, and it still didn't stop him.

DerekRight. The controls worked exactly like they're supposed to. The problem was what happened next.

GrantAnd in this room, the guy who set it off fired the fire department.

DerekBasically.

GrantSo he's locked out. He's fired the wallet controllers. He's threatening lawsuits. What's left of the company?

DerekOne website and one contractor. That's it.

GrantOne?

DerekOne person keeping the lights on for over a year.

GrantOne guy holding up the appearance of a company.

DerekThat's the next stretch of this story, how thin you can stretch still building. Psst, picture this. Multisig's gone. Staff's gone. Budget's gutted. And what's left running the show?

GrantA guy with a laptop.

DerekOne contractor. OCCRP's reporting on the indictment says Tarsha fired almost all staff and kept that one contractor just to fake continued development.

GrantSo the entire illusion of a working NFT marketplace ran on one freelancer's invoice.

DerekFor eleven more months, allegedly. Meanwhile, he's still spending, the condo, the DJ gear, interior design, the greatest hits.

GrantMm-hmm. And somehow after all that, they actually launched the token.

DerekThey did. BeInCrypto's coverage says FAR went live in May twenty twenty-four, two years after the first investor wired money in.

GrantSo let's do the math. Opened around thirteen cents.

DerekThirteen cents.

GrantAnd then?

DerekDown more than-

GrantWow

Derek... ninety-nine percent. Trading basically stopped. A gumball machine has better returns. And here's the kicker. The Few&Far website's still up.

GrantMm-hmm.

DerekStill advertising FAR as live on main net.

GrantWait, right now? Today?

DerekToday. Go look.

GrantFeels like a Halloween decoration nobody bothered to take down.

DerekMinimal viable illusion, a domain that resolves and one guy typing.

GrantThat's it? That's the whole tech stack?

DerekPractically. Keep the front end loading, update a blog post every few months, and nobody circling the wallet thinks to check if the back end's actually shipping. Terrifying how cheap that is, which is why the defense here is gonna be interesting.

GrantSo how does anyone argue fraud instead of a failed startup?

DerekOh, that's exactly the argument his lawyers are about to make. Building off that dead website, the real fight in this case sits with Reed Smith.

GrantThe defense lawyers?

DerekKaela Dahan and Evan Barr. OCCRP got their statement. They're calling Few & Far a legitimate Web3 startup that hit the same market collapse everyone else did in twenty twenty-two.

GrantSo just unlucky timing.

DerekThat's the argument. And to be fair, money was flying at anything with decentralized in the pitch deck back then.

GrantDoesn't explain the DJ gear.

DerekNo, it does not. But the real legal problem for prosecutors is tracing specific dollars. Sixty-seven investors, one wallet.

GrantWait, why is that harder than, like, a bank record?

DerekA bank ledger shows deposit, withdrawal, done. Crypto funds get pooled, co-mingled. Once it's in the wallet, whose dollar bought the condo?

GrantSo the defense gets to say, "Prove it was my client's money, not some other investor's"?

DerekBasically. It's a real argument in crypto fraud cases, and it doesn't always lose.

GrantOkay, zoom out with me for a second, because this is the CaaStle case again, just different jargon.

DerekGo on.

GrantJune twenty twenty-three, the audit catches the bonuses, catches the wallet lockout.

DerekMm-hmm.

GrantThe detection worked.

DerekAnd then a year goes by on one contractor and a dead website.

GrantThat's the pattern this show keeps running into. The alarm goes off just fine. It's whoever hears it that decides to do nothing.

DerekNo trial date yet. Judge Kaplan's docket. Each charge carries a max of twenty years, so the stakes on either side are real.

GrantFailed startup or felony. We'll see which one a jury buys.

DerekSo that's Few & Far, a company that caught its own fraud in-house in twenty twenty-three and just kept going anyway.

GrantYeah. That audit finding those bonuses, that should have ended it right there.

DerekRight, but firing the people who noticed the problem isn't exactly a fix.

GrantNo. That's just picking a different problem.

DerekHonestly, that's the pattern we keep finding on this show. Somebody always sees it early.

GrantThe failure's never the seeing. It's what happens after.

DerekExactly. Worth remembering next time a pitch deck sounds a little too clean.

GrantIf this one got you, tell a friend who still trusts every deck they read.

DerekSubscribe wherever you're listening and leave us a review. It actually helps.

GrantWe're gonna be back with the next one soon.

DerekThanks for hanging out with us. See you next time.

GrantTake care, everybody.