Investors Raise Concerns Over Financial Irregularities at Mojocare
- ByStartupStory | June 19, 2023
In a recent development, prominent investors of Mojocare, including Sequoia Surge, B Capital, and Chiratae Ventures, have voiced concerns over alleged financial irregularities following significant employee layoffs. The consortium issued a statement expressing their worries and initiating a thorough examination of the company’s financial statements.
“While the analysis remains ongoing, initial findings have uncovered financial irregularities, and it has become apparent that the business model is not sustainable due to a variety of operational and market factors. As a result, Mojocare will be scaling down operations, and the investor group is working with the company through its transition,” stated the consortium.
In response to these allegations, a spokesperson from Mojocare asserted their commitment to collaboration with investors to navigate the challenges ahead. They vehemently denied any claims of funds being unlawfully withdrawn from the company and stressed their joint efforts to determine the best path forward.
Mojocare, which recently terminated approximately 80% of its workforce, cited the need for capital efficiency and cost rationalization. The spokesperson highlighted the company’s aim to prioritize profitability and sustainability through streamlined operations and a resilient team.
“Our decision to streamline costs and operate with a smaller yet resilient team is driven by our commitment to enhance capital efficiency. We are determined to align our principles with our expected outcomes and pave the way for future success,” the spokesperson further added.
With a total funding of $24 million, Mojocare had an estimated valuation ranging between $70-75 million. The company’s co-founders, Ashwin Swaminathan and Rajat Gupta, have acknowledged the challenges they faced and expressed their dedication to addressing them in collaboration with investors.
Mojocare operates as a direct-to-customer healthcare platform, providing solutions for health concerns, doctor consultations, and product offerings. It joins the ranks of other Indian startups, including BharatPe, Zilingo, Trell, GoMechanic, and BYJU’S, currently under investigation for financial irregularities.
The situation at Mojocare highlights the growing scrutiny on financial practices within the Indian startup ecosystem and emphasizes the need for transparency and adherence to robust governance frameworks.
Quote from Mojocare Spokesperson: “We are actively working with our investors to navigate the challenges we face. We firmly deny any allegations of financial impropriety and remain committed to establishing a sustainable and successful path for Mojocare.”
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