A venture firm connected to Jeff Bezos's brother is taking an unusual step: suing the founder of a failed company it backed.
After the startup collapsed, HighPost filed a lawsuit in Delaware accusing founder Matthew Sivewright of fraud and mismanagement.
In 2019, Mark Bezos and David Moross established HighPost, and it raised over $500 million from investors, including Jeff Bezos's family. Its HIPstr unit raised $100 million and backed brands like Kylie Jenner's vodka soda, WatchHouse coffee, and After.com.
The firm's first move into EverFence came in April 2024, when HIPstr invested $7 million and took a board seat. Sivewright, an Australian, had started the company more than six years earlier as an online platform linking homeowners with local contractors.
Things went wrong quickly. Bill Tolmasoff, the CFO, left after nearly three months, and the lawsuit says he cited internal control lapses and financial misrepresentations. Sivewright gave the board a vague reason for the exit, according to the complaint.
By November 2024, EverFence had spent nearly all of HighPost's initial investment. Toward the end of 2024, the firm committed another $3.5 million, distributed over the following months.
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The relationship fell apart in April 2025, when the board removed Sivewright and brought in Robert Rackleff as the new CFO. Rackleff's first reports were alarming: March revenue was overstated by more than $2.1 million, expenses were understated, and profit margins were inflated by nearly one-third.
HighPost's July complaint alleged that Sivewright and two other executives misrepresented the company's finances. The filing said Sivewright presented a rapidly growing, profitable tech firm, but much of the revenue was fabricated and profitability was overstated.
Sivewright's lawyer, James D. Daily, pushes back hard. Daily says, "HighPost invested with full knowledge of what it was buying," calling the firm a "sophisticated investor" with "full visibility into the company." He also notes that Sivewright invented the technology behind the business and funded it himself from the start.
Sivewright himself wrote in a memo: "As villains go, I've done a poor job - funding operations personally and leaving myself financially exposed." He says he was personally on the hook for $430k as a guarantor on EverFence's American Express card.
The company kept getting funding through April 2026, based on financials from Rackleff that HighPost now says were also false. EverFence shut down in June, and the board member from HighPost stepped away that month. In July, HighPost went to court to reclaim its investment, naming Rackleff and ex-COO Matthew Couper as defendants.
For everyday investors, this story is a window into how messy private investing can get. William & Mary professor Vladimir Atanasov says suing a founder can be seen as "bad news" for a firm's due diligence, since "most VC firms pride themselves on their good due diligence."
The human costs show up outside the courtroom too. Former EverFence sales manager Andrew Kaufman said employees missed their last paycheck after the company announced its closure in June. Customer Erik Hinterbichler couldn't get his deposit back after canceling an order. "It was total silence from anyone involved," he said.
Sivewright is now in arbitration challenging his "for cause" termination and seeking repayment of legitimate business expenses. His lawyer says he even "offered to pay for an independent audit."
The takeaway for investors is simple: when you put money into a startup, you are betting on people as much as products. And when that bet goes wrong, the fight over who is at fault can drag on long after the company itself is gone.
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