From approaching Softbank for a Unicorn status to getting probed by EOW, GoMechanic has taught investors, founders and employees an important lesson in the value of corporate governance.
1. Jan-Mar 2022: Softbank was ready to invest at $850-900 Mn valuation, but co-founders were pushing for a $1.2 Bn valuation
2. Jan 2023: GoMechanic’s co-founder (Amit Bhasin) admitted to creating fake revenue figures in a LinkedIn post
3. Feb: PR campaign mentioning new focus on breaking even and profitability
4. March: Having raised $62 Mn, got acquired in a slump sale for $27.5 Mn
5. July: A couple of GoMechanic cofounders started talking about new ventures
Rishabh Karwa – Building for Local Storefronts around the World
Nitin Rana – Building Travel & Hospitality Product for Indian Subcontinent and World
6. Two days ago: PR campaign about growth and innovation in GoMechanic 2.0
7. Now: GoMechanic investors (Orios, Sequoia [Peak XV], Tiger Global and Chiratae) are pushing for a EOW probe in the role played by all 4 co-founders in misreporting financials and potential misappropriation of funds.
References:
- Potential GoMechanic Softbank deal – https://www.reuters.com/technology/softbank-plans-35-mln-bet-indias-gomechanic-sources-2022-09-06/
- Amit Bhasan’s LinkedIn Post – https://www.linkedin.com/posts/amit-bhasin-b42990a2_we-founded-gomechanic-in-2016-to-bridge-the-activity-7021348357751083008-NPaj
- PR campaign about focusing on profitability – https://www.thehindubusinessline.com/companies/after-confessing-financial-irregularities-gomechanic-says-focus-is-to-achieve-profitability-now/article66549059.ece
- GoMechanic acquired in slump sale – https://m.economictimes.com/tech/startups/car-servicing-startup-gomechanic-acquired-by-lifelong-group-led-consortium-in-slump-sale/amp_articleshow/99079559.cms
- Co-founders looking at new ventures – https://inc42.com/buzz/gomechanic-cofounders-new-startups-six-months-fake-revenue/amp/
- GoMechanic 2.0 PR – https://theprint.in/ani-press-releases/gomechanic-2-0-new-management-driving-growth-and-innovation/1723465/
- Investors pushing for probe: https://m.economictimes.com/tech/startups/original-investors-file-eow-complaint-over-financial-irregularities-at-gomechanic/amp_articleshow/102952812.cms
Note: In case you are looking for a Product Management course, I would highly recommend joining this cohort-based course – ISB Executive Education – Product Management program
PS: You can connect with me for review or referral discount (link for referral discount)
