Just to clarify, the event has already taken place? Is that correct?
You said the business partners were supposed to attend, but none of them did.
I think this is probably a good opportunity to sit down with your co-founder and discuss what went wrong.
Rather than just accuse them of wasteful spending, create a learning experience for them (or you).
The type of questions you'll want to ask is
1) Why did they think it was a valuable way to spend company money?
2) What sort of result did they expect? If partners were supposed to attend, did they expect an increase in revenue from the event? If not, why are they spending money on partners/
3) What would they do differently next time?
4) Is there a way they could have reached the same goals without spending the money at all? How can they be more creative, etc?
Perhaps the CEO had a master plan that didn't work out (unlikely), perhaps they just wanted to blow off steam. Maybe they heard it's what other companies did, and therefore thought it was a sign of what they should be doing.
I wouldn't attack them, but make sure they understand that you believe this was not a good use of company funds, and that as a result of these actions, you now must do X, Y, Z in order to get back the money that was spent (how much more sale, how much more advertising, which leads to more hiring, etc).
Paint the picture in clear detail of what the event cost beyond the dollars spent and time lost. For every $100 they spent on the event, the company needs to earn $240 (or whatever your margins are after tax, etc etc).
This way you can make it clear that the next time they attempt to do something like this, that they understand the cost isn't the $$$ going out, it's the cost of getting those $$$ back in!
Also make it clear that there are limits to how much they should be spending without discussing it with you. I assume they wouldn't make a major hire without consulting you, so why would it be OK to spend a huge chunk of revenue.
There are probably some notices you may want to write down about the event to keep just in case of future litigation, etc. But you'll want to speak to somebody with legal experience about that...and do the legal thing after the discussion.