Silica Valley
NYSE, 15/04. Chaos ensued yesterday morning at the IPO of Stylischgermandatastoragekompanie GmbH. The Sandau-based startup made headlines early last year, promising safe, redundant data storage at unprecedentedly low costs, made possible by an alleged ‘patent-pending process’. The company quickly drew millions in investments from potential clients and angel investors. After taking on its first clients this fall, the then-private firm enjoyed resounding success, installing itself as a landmark player in the data storage market.
Yesterday, hours after its much-anticipated IPO, clients started reporting service outages. Stylischgermandatastoragekompanie temporarily blocked off access to clients’ stored data, citing ‘minor technical difficulties’, which they expected would be ‘resolved shortly’. This shutdown sparked outrage amongst investors and clients alike, who now demand answers and accountability. Thus far, their calls have gone unanswered; the company has also declined our request for comments.
Today, light is finally being shed on the situation. Our offices in Libya were contacted by Monira Zwait, the 19-year-old co-founder of Sharikat Storage LLC. This under-the-radar outfit currently counts only three employees, two founders included, and operates in the country’s remote south.
Monira revealed that Sharikat Storage was founded shortly after a conspicuous group of German investors visited her hometown, looking for cheap data storage. ‘My friend Nasser and I had just finished high school, and were quite worried about finding jobs. We [went to ask them] what this ‘storage’ was all about, and they said that they would pay us to store information. Now, we had spent many years in school filling endless notebooks, so we told them we knew a thing or two about data storage. They asked for our company's name, so we made one up on the spot. Then we signed a couple papers, and they promised to pay us for our work.’
Remarkably, this misunderstanding went unnoticed for months, even as the German company rapidly scaled its operations. According to Monira, the arrangement between the two companies included an office for co-founder Nasser at Stylischgermandatastoragekompanie’s Sandau headquarters. ‘From there, [Nasser] would call me every day and read out long strings of numbers from his computer, and I would copy them into notebooks. When necessary, I would read out requested pages to him.’ The pair’s only operating costs were international calls and stationery. They quickly ran headfirst into an obvious issue. ‘The data just kept coming in, and our notebook scheme was becoming unsustainable. One evening, as I gazed out at the desert sunset, I wondered if the answer perhaps lay in the dunes. The next morning, I brought a stick and started writing in the sand. Wind would erode the numbers, so I hired my brother to go through them and restore those that were getting erased.’ By means still unclear to us, the trio’s plot remained undetected for months. ‘We were just that fast. But it all fell apart when Nasser had to leave headquarters to attend the IPO. The board had invited him. We couldn’t transfer the numbers anymore, so our whole system froze over. Cue yesterday’s service meltdown.’ Monira claims to have shortly received a call from Stylischgermandatastoragekompanie’s COO. ‘They started asking for answers. I gave them answers. They really did not like those.’
As for why she came forward, Monira had this to say: ‘There is no fundamental problem in our operations here at Sharikat Storage. This incident occurred due to a scheduling conflict. I think it’s good for the truth to be spoken. Clients can now cut out the middleman: we’re well-equipped to directly provide the service they need.’ In the wake of these revelations, the German firm's legal standing is currently unclear. In terms of immediate financial impact, we expect Stylischgermandatastoragekompanie’s valuation to plummet beyond this morning’s 40% drop. Sharikat Storage has announced no plans for expansion. ‘Why change something that works?’
