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FRESNO, Calif. (KFSN) — Bitwise Industries was once a nationally recognized company for its efforts in providing tech opportunities to communities like Fresno but has since fallen on hard times.
The stunning revelations of its financial troubles have left many wondering what led up to the furloughs and what the company was doing inside its large office buildings.
To put it bluntly, Bitwise tried to do a lot before they fell on hard financial times.
What does Bitwise do?
According to its website, Bitwise’s mission is to be a transformative tech company offering technology-based solutions for underserved cities. But the company is also a major landlord, renting out offices and coworking spaces in its buildings.
Bitwise pitches itself to customers as a company that could help them meet technology goals like building a website or a mobile app. Many of their services are often built on other companies’ products, like Salesforce and DocuSign.
RELATED: Employees at Fresno-based Bitwise Industries being furloughed, leaving hundreds without work
To accomplish this work, the company often hired “apprentices,” typically from disadvantaged backgrounds. The apprentices would get on-the-job training and work directly with Bitwise’s client base of local companies or government entities. The company called the program a force of good for the communities they were a part of.
Why are we talking about Bitwise?
Bitwise co-founders and co-CEOs Jake Soberal and Irma Olguin Jr. told their 900 employees on Monday, May 29, that they were being furloughed, effective immediately.
At this time, officials say they are just suspended but are still considered employees.
However, employees have not been given a timeline of when, if ever, they may be able to return to work.
Where was Bitwise located?
Bitwise first began in 2013 under the name “Geekwise Academy” and was founded by Olguin and Soberal.
By 2019, they would expand into the facilities known today and have since become a staple of Downtown Fresno with its four colorful buildings and giant signage, often playing host for events such as ArtHop.
RELATED: Financially-struggling Bitwise has not paid city business taxes since 2021, mayor says
Bitwise also grew away from its Fresno base, expanding to buildings in Bakersfield and the Bay Area and outside California in Toledo, Ohio, and El Paso, Texas.
The company was set to expand into Chicago, Buffalo, NY, Greeley, Colo., and Las Cruces, NM.
How did this happen?
Many inside the company thought Bitwise was thriving, but the furloughs revealed the financial troubles the company was in.
In a letter sent to employees, the company warned last week’s paycheck might bounce.
Bitwise also owes the City of Fresno business taxes dating back to September 2021.
The city said they issued several late notices for those taxes, with the latest going out in December 2022.
There have also been reports, unconfirmed by Action News, that Bitwise was in contact with local business leaders in hopes of obtaining bridge loans to help with its financial troubles.
What’s next?
The mayor’s office said Bitwise violated California’s Worker Adjustment and Retraining or WARN Act by not giving 60-day notice that a furlough was coming.
RELATED: Fresno leaders claim Bitwise violated WARN Act with company-wide furloughs
“I firmly believe Jake Soberal and Bitwise have robbed this city of that time, that critical time,” said Fresno City Councilmember Mike Karbassi.
Now, city and state leaders are working to find resources, starting with a resource fair for Bitwise employees on June 9th.
People who are affected by Bitwise’s furloughs are encouraged by state assemblyman Jim Patterson to apply for unemployment.
“If you’ve already filed, that’s great,” said Patterson. “Let us make sure you get paid sooner, not later. Don’t wait for EDD to respond to you. Don’t try to call them. Call my office. We’ll get to work on it for you right away.”
