Stunned employes of the high-powered private intelligence network known as IRIS were dismissed yesterday and told that the company will file for bankruptcy next week.
More than 100 IRIS employes--including former senior officials of the State Department and prominent international journalists who had given up their former jobs and relocated to the Washington area--received what they were told would be their last paychecks. An official at IRIS's Crystal City office said a last-minute infusion of funds would cover the checks, but he advised the recipients to cash them immediately, rather than deposit them for credit or hold them until Monday.
IRIS, an acronym for International Reporting Information Systems, went under when European investors who had pumped more than $15 million into the company over the past year suddenly pulled the plug. Employes said they were shocked by the decision, because the product the investors had paid so much to develop never even had been tested in the marketplace. Moreover, IRIS never had expected to make money for at least another year.
"We were under budget, and we were on schedule with product development and with marketing," one employe said. "The investors just panicked. They shut the factory before the first model ever rolled out the door."
Most IRIS employes milling about the office asked not to be quoted by name because their contracts prohibited it, and they said they did not wish to jeopardize their chance to receive whatever pay or benefits might still be due them. Several of the foreign journalists, however, got nothing, because they were officially under contract as consultants rather than full-time employes, and the company said bankruptcy laws prohibit payment of contractors. IRIS correspondents abroad also got nothing, employes said.
The company's senior vice president, Paul Boeker, a deputy assistant secretary of State in the Ford administration, said he could not talk about what was happening.
IRIS, often described as a "private spy network," was designed as a worldwide, multilingual information service for well-heeled clients, combining computerized data collection and analysis by diplomats and journalists.
Start-up costs for personnel, computers, recruitment and the Crystal City space came to more than $15 million before the first client was signed up, but the European investors who sponsored the organization were prepared to put up $10 million more, Boeker said last month.
Early in January, however, IRIS laid off one-third of its staff as investors began to pull back. After a meeting in London two weeks ago, the investors said they would continue to back IRIS, but bickering within the group apparently led to a cutoff of funds.