This startup's demise suggests California regulators are cracking down on Silicon Valley

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It may have worked for Uber, but bucking the law, it turns out, is not always the best path to Silicon Valley success.

Leap Transit, a luxury bus startup beloved by San Francisco techies but loathed by nearly everyone else, has filed for bankruptcy, according to a commercial liquidation auction site listing for two of its buses. If you're in the market for a swanky startup bus, bidding starts at just $5.


Leap's demise suggests that regulators in California may be losing their tolerance for bull-horned tech startups that ignore the rules.Hoping to attract luxury commuters in the Bay Area, Leap had outfitted buses with reclaimed wood and Blue Bottle coffee service, and then charged $6 per ride. But it was operating without a license, existing in a legal gray area between state and city regulation.


Leap tried to get its high-end bus service approved by state regulators, hoping to avoid the stricter oversight of local government. But when regulators realized that Leap had no license at all, they decided it was breaking the law. In May, Leap announced that it would temporarily shut down, after the California Public Utilities Commission served the company with a cease-and-desist order.

Even then, Leap CEO Kyle Kirchhoff maintained that Leap was “in full compliance with all state and local laws.” The company faced additional criticism for removing wheelchair accessibility for its buses, which is required by federal law.

Kirchhoff did not respond to a request for comment.

Leap launched in March, with $2.5 million in venture capital funding, but its assets are now estimated to be worth between just $100,000 and $500,000, according to Chapter 7 bankruptcy filings dated July 15.


The company’s Facebook and Twitter accounts have been silent since May. In June, three of its five buses went up on another auction site and sold for $25,000, according to the filing. Its remaining assets include the other two buses, valued at $15,000; $75,000 that Leap still has in the bank; and what we can only assume is a lot of leftover Blue Bottle coffee beans.