TEL AVIV (Chatnewstv.com) — A Canadian venture capital fund is suing Israeli startup GEOX and several of its directors, seeking to cancel a $1.5 million investment it says was made on the basis of false information.
The Group Ventures (TGV) filed the suit alleging GEOX systematically misled investors during a Series A funding round in 2024 by inflating revenue, overstating customer agreements, and projecting unrealistic growth.
“TGV was induced to invest through systematic misrepresentation, not isolated errors,” the lawsuit said.
The fund claims it was persuaded to sign a $1.5 million agreement in December 2024 after GEOX promoted itself as a high-growth company aiming for an initial public offering in 2029. Roughly 54,000 shares were issued to TGV. The fund also cited the participation of Flashpoint Venture Capital, which invested $8 million in the same round, as influencing its decision.
According to the lawsuit, GEOX presented itself as a thriving business but was in fact losing customers, burning about $500,000 a month, and running a growing deficit. Annual recurring revenue was allegedly inflated by about 50%, while purported agreements with major customers “did not exist,” TGV said.
The lawsuit also contends that GEOX failed to provide full documentation when the fund requested accurate financial data.
In September 2024, GEOX announced it had secured $19 million from investors including Flashpoint, the Suretech R&D partnership, and private investors Ariel Maislos and Noam Lanir.
Founded in 2018 by CEO Itzik Lavi, CTO Eli Lavi, and Guy Attar, GEOX develops a platform that uses aerial photography and 3D analysis to assess real estate risks from climate-related disasters.
In a statement, the company pushed back on the allegations. “We remain optimistic about the company’s progress. We regret the claim from a dissatisfied investor. We are reviewing the documents and will respond accordingly,” GEOX said.
