Zoomcar Terminates CEO Greg Moran Amid Regulatory Review; Raises $3 Million from Institutional Investors

• ByStartupStory     |    June 28, 2024

Zoomcar, the Bengaluru-based car rental company, announced the termination of its co-founder and CEO Greg Moran after a 12-year tenure, according to a regulatory filing. The move comes amidst regulatory scrutiny concerning the market price of its Nasdaq-listed shares and its revenue projections.

Hiroshi Nishijima, the company’s Chief Operating Officer, has been appointed as the interim chief executive officer.

“On June 20, 2024, Greg Moran, the company’s chief executive officer, was terminated from his role. Pursuant to Moran’s employment agreement, Moran is required to resign from the Board of Directors of the company as a result of such termination,” read SEC filings as of June 21.

In conjunction with the CEO’s termination, Zoomcar disclosed that it raised $3 million from institutional investors. “Zoomcar Holdings Inc entered into a securities purchase agreement with certain institutional accredited investors pursuant to which the company issued and sold an aggregate of $3,600,000 in principal amount of notes and warrants to purchase up to an aggregate of 52,966,102 shares of company common stock for gross proceeds of $3,000,000. The closing occurred on June 20,” the SEC filings showed.

On February 5, SEC filings revealed that the regulator sought clarity on the firm’s revenue projections. “We note that the projected revenues for 2023 were $21.6 million, as set forth in the analysis of financial advisors and in connection with the evaluation of the business combination. We also note that your actual revenues for the year ended March 31, 2023 were $8.8 million. It appears that you will miss your 2023 revenue projection,” the filings said.

Greg Moran took to LinkedIn to express his thoughts on the termination. “This week marks the end of a decade-plus journey at the helm building Zoomcar. I couldn’t be more proud of what we’ve built in India and beyond as we introduced the power of car sharing to millions of new consumers across countless cities. Special shoutout to the entire Zoomcar team and our loyal customers for the continuous support along the way,” he wrote.

Zoomcar was founded in 2013 by Greg Moran and David Back. The Bengaluru-headquartered company provides car rental services, allowing customers to rent vehicles on an hourly, daily, weekly, or monthly basis. The company has attracted investments from Peak XV, Ford Smart Mobility, Nexus Venture Partners, Mahindra & Mahindra, and other angel investors.

In 2023, Zoomcar completed its merger with the blank-check company Innovative International Acquisition CorpM (IOAC) through a SPAC deal and was listed on the Nasdaq. The merger implied a pro forma enterprise value of about $456 million for the business. Before going public, Zoomcar had raised more than $400 million in funding.

The developments were first reported by ET Prime.

Follow Startup Story