Blussmart Crisis: Former Bombay Stock Exchange (BSE) president S Ravi expressed deep concern over the recent allegations around Blussmart, saying that such incidents can damage the trust of investors and tarnish the widespread perception of startups.
Former BSE president and founder of Ravi Rajan & Company S. Ravi (Sethurtam Ravi) warned that these actions may shake the trust of investors in new enterprises and even affect the reliability of well -established startups.
Recently, the Market Regulatory Securities and Exchange Board of India (SEBI) raised issues to alleged fund diversion and document forgery to Jansol Engineering Limited, which had a direct impact on the Blissmart, which eventually suspended its services.
Anmol Singh Jaggi, along with his brother Puneet Singh Jaggi, is the co-founder of Blussmart and has also worked as a director in Ahmedabad-based solar engineering and service firm Jansol Engineering. Both have resigned as their director after SEBI notice.
“This is not good for two reasons. First, when new investors and companies come, existing investors can completely stop funding. They will feel that the startups are focused only on individual benefits and increased evaluation. It's not good at all,” Ravi said. “Secondly, Blussmart was a well -installed brand. It is not a small name – it was made with great hard work. But they demolished it for personal gain. They might have earned money in a short term, but this shortcut is not correct,” he said.
The former BSE chairman also pointed to allegations of insider trading, mismanagement and fund diversion. According to the definition, insider trading involves buying or selling a company's stock using confidential, non-public information.
“There were two trigger points. First, concerns were expressed about the pricing of shares – there were many complaints about insider trading. Second, one came forward with a complaint against a whistleblower company. SEBI started an investigation and issued an interim order. In that order, he found some shortcomings including fund diversion and wrong statements,” he explained.
Looking further, Ravi emphasized that startups and his promoters should focus on transparent communication and honest revelations to prevent such incidents. He said, “The startup community should now start connecting with all lenders and stakeholders, and it should demonstrate that they are working under a strong governance structure.” Discussing the roles of independent directors and auditors, he emphasized that promoters should provide accurate and complete information to enable better revelations.
