Headspin founder, Los Altos entrepreneur sentenced to prison

LOS ALTOS, Calif. - A Los Altos tech entrepreneur was sentenced to prison for giving potential investors false financial information while the company raised more than $100 million, federal prosecutors said Friday.   

HeadSpin Inc. founder Manish Lachwani, 47, was handed an 18-month term by U.S. District Judge Charles Breyer following his conviction on wire and securities fraud charges.   

Lachwani's company provided software tools and access to remote devices to test mobile applications, the U.S. Attorney's Office for Northern California said. Between April 2017 and April 2020, HeadSpin raised more than $100 million from investors.   

To obtain that financing, Lachwani overstated information about the company's revenue and customers, including bogus client invoices, prosecutors said.   

Breyer also ordered Lachwani to pay a $1 million fine and serve three years of supervised release after his prison term is completed.