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Investors flag financial irregularities at healthtech startup Mojocare

The financial irregularities, which include overstating of revenues, at the Bengaluru-based company have come to light in less than a year after it raised $20.6 million in its Series A round.

Mumbai / June 18, 2023 / 18:27 IST
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Mojocare joins a list of other companies that have reported cases of corporate governance lapses in the past year or so

Major investors of Mojocare, a healthtech startup, have found financial irregularities at the company. The Bengaluru-based healthcare startup inflated sales bills and overstated revenues in order to meet its targets, sources told Moneycontrol, in what looked like yet another instance of a corporate governance lapse at an Indian startup.

The episode at Mojocare is a repeat of what had happened at GoMechanic, where the founders admitted that they got carried away and cooked their books to show higher sales figures. Similarly, even Rahul Yadav’s second startup, Broker Network  (4B Networks), Trell, Zilingo and BharatPe are a few other startups that have admitted to some other financial irregularities in the past year or so.

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To figure the way forward, Mojocare’s major investors – which includes Chiratae Ventures, B Capital, Better Capital and several others – have already appointed Deloitte to carry out a forensic audit at Mojocare and the process has been in the works for the past 1-2 months, sources added.

“Mojocare’s founders have confessed to investors that they overstated sales because of pressure and revenue targets. For now, investors are not considering any legal action because there is no evidence of syphoning off of funds yet,” people aware of the developments told Moneycontrol.