Bizongo, the B2B e-commerce platform backed by Accel, Chiratae Ventures and others, is facing heightened scrutiny following concerns raised by its auditors about possible financial fraud, sources familiar with the matter told Moneycontrol.
A report from the auditor, issued in January 2025, points to potential irregularities in Bizongo's financial practices, including questionable vendor-customer relationships and missing Proof of Delivery (POD) documents.
While the auditor stopped short of confirming a fraud, it has urged for a deeper investigation to fully understand the extent of the issue.
In response to queries, Bizongo acknowledged that the auditor’s concerns are linked to past incidents, including a fraud case involving a former employee in September 2024, but insisted that the issues flagged are primarily tied to legacy operations, and the current line of business has a clean bill of health.
Auditor’s red flags: Missing documents and suspicious transactions
In its January 2025 intimation, Bizongo’s auditor, BSR & Co. LLP, had raised an alarm over discrepancies in the company's financial records for the fiscal year 2023-24 (FY24).
The auditor pointed to suspicious relationships between certain customers and vendors, such as matching addresses and duplicate names, as well as discrepancies in Proof of Delivery (POD) documents.
“The inconsistent/ inadequate audit evidence observed by us during the course of our ongoing audit…cast a doubt over the veracity of the amounts and underlying transactions recorded in the books of accounts. Accordingly, these matters require an independent investigation by the board,” BSR & Co wrote in its letter to Bizongo, which operates under the name of Smartpaddle Technology Private Limited, on January 7.
Moneycontrol has seen a copy of the emails.
These issues prompted the auditor to express concerns about the possibility of fraud, urging Bizongo’s board to conduct a thorough investigation.
“The intimation from the auditors is not a report, but an alert under Section 143 of the Companies Act, highlighting the possibility of fraud," said a Bizongo spokesperson in response to Moneycontrol’s queries.
"It is essentially a request to the board to conduct a deeper dive into the company’s financial processes to identify any malpractices," the spokesperson added.
In response to the intimation to address the auditor’s concern, Bizongo had set up an internal investigation committee on January 25, per the internal document seen by Moneycontrol.
It included Gaurav Singhania, CFO, Smartpaddle Technology (Bizongo), Accel’s Amar Maheshwari, Abhishek Raj of Chiratae, B Capital’s Chandan Deep and representatives of International Finance Corporation (IFC), an arm of the World Bank Group, Onur Onk and Yu Jin Oh.
It remains unclear whether these discrepancies are linked to the fraud uncovered in 2024 or if they indicate deeper, unresolved issues within Bizongo’s operations. However, the company is actively addressing the concerns through ongoing investigations and efforts to improve its processes.
The ex-employee, whistle-blower & the auditor mesh
The issue of fraud within Bizongo dates back to April 2024, when the company uncovered a misappropriation case involving a former employee.
The employee was accused of executing fake transactions and siphoning off over Rs 21 crore ($2.3 million), a lapse linked to the company’s now discontinued supply chain financing vertical, it claims.
This vertical, which had been central to Bizongo’s operations, was scaled down after the fraud was discovered.
Bizongo has since claimed to have filed a complaint with the Economic Offences Wing (EOW) and launched an internal investigation with the help of Trilegal and PwC. “We filed a complaint with the EOW in April 2024, and based on their investigation, an FIR was filed against the former employee,” the spokesperson explained.
“Bizongo is the victim here, and this fraud was confined to a discontinued business vertical.”
In the aftermath, Bizongo shut down its supply chain financing vertical in September 2024 as part of its restructuring efforts. The company then pivoted towards BizongoBuy and BizongoFin, focusing on raw material procurement and supply chain financing for SMEs while roping in former American express executive Gaurav Singhania as Chief Financial Officer (CFO) and former Amazon Pay executive Amol Wanjari as chief technology and product officer (CTPO). Former banker Kiran Dev was appointed to lead BizongoFin.
The company claimed this restructuring was part of a larger strategic move to reinvent itself after the incident.
Deeper investigation
As per the firm, PwC had been initially brought in to investigate the employee fraud last year, but its role evolved to include a comprehensive review of Bizongo's financial and operational processes since the auditor’s intimidation.
Bizongo claims that the ongoing review is aimed at identifying potential process gaps across the entire business, especially in areas related to finance, credit, and business operations.
“We have been working with PwC for over 12 months, first to investigate the employee fraud and then to expand their role to look at broader process weaknesses,” the spokesperson noted. “PwC has been reviewing internal controls and business operations to ensure that we fix any gaps that could allow future malpractices.”
The company asserts that these changes have led to significant improvements, with 100% compliance and governance now in place.
The trigger: Resignations and leadership changes
The fallout from the employee fraud and subsequent restructuring also triggered leadership and board changes at Bizongo.
In early 2025, Ranjth Menon, Partner and Managing Director at Chiratae Ventures, and Arijit Sengupta, Operating General Partner and Co-Head of Platform at B Capital, resigned from the company’s board, as per sources.
This came after the internal investigation and the auditor's intimation highlighting the potential for broader issues.
The CEO change followed soon after. Co-founder Sachin Agrawal stepped down as CEO in March 2025, and was replaced by Prahlad Krishnamurthi, a Flipkart veteran.
"The founder's exit was part of a natural progression; they continue to remain on the board. The professional team has come in to lead Bizongo as we pivot towards new business models," explained the spokesperson.
Lenders threaten legal action
While Bizongo claims to have reduced its debt from over Rs 1,000 crore to Rs 100 crore over the past year, some lenders’ tensions have escalated, with some of Bizongo’s creditors now threatening to take legal action against the company.
They have raised concerns about Bizongo's ability to repay debt and are also seeking legal recourse over unpaid dues, sources say.
“We are working closely with our lenders and engaging in ongoing discussions to resolve the remaining balance,” said the spokesperson. “While we acknowledge the concerns raised by our creditors, we are actively repaying the outstanding debt and are confident that we will resolve this issue soon,” the spokesperson added.
While the company restructures its operations to become a leaner one, it continues to be plagued by its previous issues which have only made it even more difficult to make progress.
Bizongo’s rise
Bizongo has raised $315 million across multiple funding rounds since its inception in 2015. It was valued at $980 million in its funding round in October 2023. It’s investors include marquee names such as Accel, Tiger Global, B Capital, Chiratae ventures, among others.
The company reported a loss of Rs 292 crore in FY23 against a revenue of 167 crore.
Bizongo’s troubles follow governance issues at other startups in recent weeks. From EV maker BluSmart to health tech platform Medikabazaar, prompting the need for tighter compliance at hyper growth startups.
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