Top investors in India-based GoMechanic, a troubled car-servicing firm, said the startup had given them false financial information, which included inflated revenue numbers.
In a statement given to Tech in Asia by a group of GoMechanic’s major backers, they said that they’ve hired a third-party firm to audit the startup’s finances.
Photo credit: GoMechanic
Tech in Asia has learnt that Tiger Global, Sequoia Capital India, and Chiratae Ventures made up the clutch of these backers.
“We are deeply distressed by the fact that the founders knowingly misstated facts, including but not limited to the inflation of revenue, which the founders have acknowledged. All of this was kept from the investors,” they stated.
The development follows an announcement made by Amit Bhasin, co-founder of GoMechanic, that outlined the company’s plans to let go of roughly 70% of its workforce.
The startup also aims to go through restructuring plans and look for “capital solutions” to help it wade through the economic downturn.
See also: Tracking layoffs across Asia’s startup ecosystem (Updated)
Editing by Samreen Ahmad and Lorenzo Kyle Subido
(And yes, we’re serious about ethics and transparency. More information here.)
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