Last week, Fortune reported on the fall of IRL, a social app startup that, after topping $1 billion in valuation a few years ago, said it’s shutting down because 95% of its users were fake. This week, venture capitalists weighed in on the debacle, with a focus on how investors got it so wrong.
IRL joined the ranks of unicorns—companies with private valuations of at least $1 billion—thanks to a $170 million Series C funding round led by SoftBank Vision Fund 2 (among the returning investors were Goodwater Capital, Founders Fund, and Floodgate), bringing its total raised to more than $200 million. Suspicions of its “zombiecorn” status grew after CEO Abraham Shafi stepped down in April following employee allegations of inflated user numbers.
