BharatPe's co-founder Ashneer Grover has taken voluntary leave till March-end, the company said, days after an audio clip went viral in which he allegedly threatened and hurled abuses at a Kotak Mahindra Bank employee.
Grover initially called it a “fake audio by some scamster trying to extort funds," but later deleted his tweet. Kotak Mahindra Bank is now pursuing legal action against him over “inappropriate language” used against one of its employees.
The controversy has put a spotlight on BharatPe and its troubled history. Here are some of the other issues that plague the $2.9 billion fintech unicorn.
Co-Founder Convicted for Credit Card Fraud
Bhavik Koladiya, a former co-founder at BharatPe, was convicted of credit card fraud in the United States (US) in 2015 following his arrest in 2013, according to a report by The Captable.
Koladiya stole people's identities, used them to open credit card accounts with different banks, and bought merchandise, the report suggests.
While his conviction does not bar him from investing or working in an Indian company, it is unclear whether this information was disclosed to BharatPe's board and investors.
Koladiya is currently the group head of product and technology at BharatPe and could potentially have access to sensitive payments information, which could be problematic given his history.
BharatPe facilitates transactions for lakhs of merchants across 100 cities. Koladiya and Shashwat Nakrani co-founded the company in March 2018, while Grover joined a few months later.
Spat With Sequoia Capital
Sequoia Capital, a venture capital firm, is the single largest investor in BharatPe, followed by Coatue and Beenext.
In 2020, Ashneer Grover had an altercation with Harshjit Sethi, the managing director at Sequoia India and a board member of BharatPe, according to Economic Times.
He allegedly sent aggressive messages, expletives, and threats to Sethi over several months because of a delay in funding.
“Messages and threats from you over the last few days and months have been hurtful and disappointing," Sethi reportedly said in an email to Grover, adding that there needs to be a "decisive conversation about how the relationship between Sequoia and BharatPe changes going forward."
Reports of a Toxic Work Culture
There have been multiple reports about a toxic work culture at BharatPe in the past two years.
Three senior executives at the start-up left in 2020 citing the firm’s aggressive work culture and lack of decision-making authority, according to a Moneycontrol report.
“There is a culture where you hire fast and fire fast," an inside source told the publication. Grover calls all the shots and many senior executives have very little real authority, said others.
Some of BharatPe's employees have been forced to come to work during the pandemic and haven't received appraised salaries on time, Economic Times reported.
Grover, who is one of the 'sharks' on Shark Tank, has garnered a reputation of being harsh and abrasive towards entrepreneurs who appear on the show in hopes of finding investors for their products.
His approach of hiring tech talent by offering motorcycles, iPads, and trips to Dubai in 2019 also received flak.
(With inputs from The Captable, Economic Times, and Moneycontrol.)