- Robot startup Foundation has failed to pay employees since missing its Oct. 30 payroll, angering some workers after its CEO borrowed $4.6 million from the firm last year to buy a luxury home, according to people familiar with the matter.
- CEO and co-founder Sankaet Pathak is Foundation’s sole board member, raising governance concerns among prospective investors.
- Foundation’s widely reported $24 million in Pentagon contracts actually stems from its 2024 acquisition of Boardwalk Robotics, which held some existing government research contracts, the people said.
- Pathak’s previous company, Synapse, collapsed in 2024, leaving thousands of customers without access to deposits. Pathak reportedly took loans from Synapse as it neared bankruptcy.
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Foundation Future Industries, a maker of military humanoid robots advised and backed by Eric Trump, failed to pay employees last month as its cash reserves dwindled, according to people with direct knowledge of the matter.
The situation has particularly angered some inside the startup because its CEO and co-founder, Sankaet Pathak, borrowed $4.6 million from the company last year to buy a luxury home, money that could have been used to pay workers, the people said.
Public records show that an LLC that names Pathak as sole principal purchased a $4.6 million Sausalito, California, property with “sweeping, cinematic views” of the San Francisco Bay in October 2025.
A spokesman for Pathak acknowledged receiving a detailed list of the major points from this story on Thursday, but didn’t respond to requests for comment. Pathak’s previous startup, a fintech firm named Synapse, collapsed in 2024, leaving thousands of Americans locked out of their savings accounts.
Foundation’s cash crunch comes at a precarious moment for the company, which Pathak has said is close to unveiling a next-generation, weapons-ready robot that will help the U.S. compete against Chinese rivals. At the same time, Pathak is seeking to raise hundreds of millions of dollars in funding at a $3 billion valuation.
The company has garnered headlines this year for Pathak’s claims that his robots could soon take on battlefield tasks in Ukraine or patrol the U.S. border with Mexico. Broadcast interviews and articles about Foundation also include claims that the company has won $24 million in Pentagon contracts.
“What we’re about to unveil in the next couple of months [is] going to be the strongest humanoid robot that exists anywhere in the world, including China,” Pathak said in an April television interview.
‘Plain sight’
That April interview introduced Eric Trump, the son of the U.S. president, as a Foundation investor and chief strategy advisor. It is unclear how large his stake is.
Eric Trump and his brother Donald Trump Jr. have invested in an array of defense firms, including makers of military drones and autonomous weapons. A July Washington Post investigation found that startups backed by investment vehicles linked to the brothers had secured at least $3.2 billion in government business.
“We have to win robotics in the United States of America,” Eric Trump said in April. “When you go up and interact with these robots ... they fist bump you, they high five you, they follow your commands.”
Eric Trump’s involvement in Foundation drew the swift ire of Sen. Elizabeth Warren, D-Mass., who asked whether Foundation won U.S. defense contracts because of nepotism.
“Eric Trump went on FOX to brag about winning ANOTHER multimillion-dollar contract from the Trump administration,” Warren said in an April 23 social media post. “This looks like corruption in plain sight.”
by Hugh Son, CNBC | Read more:
Image: Aleksandra Michalska | Reuters[ed. Is anyone surprised that corruption as an issue ranked so highly in this last election's political polling? When there's no accountability and a mind-numbingly long list of examples (like this)? See also: Kalshi Severs Its Relationship With Donald Trump Jr.; and, As Congress Plans Investigations, White House Prepares Ferocious Response (NYT).]
