GrabGas woes continue as Digi decides not to invest in the startup

The winning startups of the Digi Accelerator program. Photo credit: Digi.

The fallout from the GrabGas controversy continues unabated. Today, Digi Accelerate, the accelerator program of Malaysian telco Digi Telecommunications, said it will no longer invest in the company.

GrabGas was one of the three winning startups in its inaugural cohort, announced in a demo day in Bangkok on August 22.

In a statement via email, Digi said “it will not proceed with its investment in GrabGas on grounds of inconsistency in the disclosure of data.” The telco stated that transparency and integrity are fundamental to the way it does business and for this reason it decided to not go forward with the deal.

The acceleration program had a duration of four months. It’s not clear whether any inconsistencies with regard to GrabGas’ data came up during that time.

Digi provided the following statement to Tech in Asia:

“We took reasonable steps comparable to established accelerators when assessing and selecting participating startups for the program. We will continue to evaluate the best practices that are relevant and also apply the same principles as we did this year, such as to require startups to sign a Participation Agreement that warrants them to provide true and accurate information at all times.

“Having said that,we also recognize that there is a certain element of trust and risk involved in these sort of startup engagements. In consideration of GrabGas and the review process, we will not share more details.”

Here’s Digi’s initial statement in full:

Digi Telecommunications Sdn Bhd (Digi) said today that it will not proceed with its investment in GrabGas on grounds of inconsistency in the disclosure of data. The decision follows a comprehensive review which concluded on Tuesday. Transparency and integrity is fundamental to the way Digi does business, and the decision is a reflection of the same principles it upholds and expects of its partners.

On 22 August 2016, the company announced it will be investing equity funding in three startups that graduated from Digi Accelerate, at which point, the shareholder agreements were ongoing to assess their performance and ensure business practices adhered to company’s standards for proper business conduct.

More on GrabGas

• CTO quits startup, takes tech with him after team ‘screwed him over’
• Why and how we covered the GrabGas controversy

This story has been updated with Digi’s follow-up statement.