With confessions of revenue fraud and layoffs impacting 70% of its workforce, #GoMechanic is the latest Sequoia-backed startup to come into the limelight for such discrepancies
So what exactly happened? We try to go behind the scenes
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The issues have emerged after a year in which 's losses ballooned to INR 114 Cr, but there are a lot of discrepancies even in the company's official filings, as we have highlighted here:
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While investors have called for a forensic investigation of its financials, the future of the company hands in the balance.
If the founders are asked to step away, which is the most likely course of action, who will lead ?
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The admission by #GoMechanic's founders after misleading investors for years by showing fake numbers raises questions about the wilful fraud.
Investors also told us this puts the reputation of other startup founders at risk
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GoMechanic’s uncertain future could involve a distress sale its existing tech, or a change of management along with a fundraise at a lower valuation. But will the duplicity of its founders prove to be a deal-breaker, whichever way it goes?
inc42.com/features/gomec
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Seriously, VC's can fake the companies to the public, but start outing companies once they figure this can't make the fake cut.