The Indian startup ecosystem finds itself embroiled in another controversy as Amrendra Sahu co-founder of home rental platform Nestaway filed an FIR against the companys investors. These investors include Tiger Global Goldman Sachs Chiratae Ventures along with co-founders Jitendra Jagadev and Smriti Parida. This case has revealed troubling details about financial and legal turmoil within the Indian startup ecosystem. Heres how a company once valued at Rs 1800 crore with Rs 700 crore in funding was sold for just Rs 90 crore raising serious questions about corporate governance and investor practices. From Rs 1800 Crore To Rs 90 Crore In 2020 Nestaway was valued at Rs 1800 crore and had raised Rs 700 crore in funding. However the company was sold for a meager Rs 90 crore marking a dramatic decline in its valuation. During the COVID-19 pandemic Nestaway faced significant uncertainty as all co-founders except Amrendra Sahu exited the company. Despite the challenges Nestaway managed to stay afloat by selling non-core assets and securing enough cash reserves to sustain operations for at least two more years. According to a Zee Business report citing IANS sources which revealed that even after receiving a Rs 50 crore investment proposal from Gruhas (the investment arm of Zerodha’s Nikhil Kamath) the company’s lead investor Tiger Global allegedly pushed for a distress sale at a staggering 80% loss. Investors And Allegations Of Conspiracy The forced sale raised eyebrows especially among minority shareholders who questioned the rationale behind such a massive valuation cut. Allegations emerged that investors conspired to push the sale despite the company’s financial runway and potential funding opportunities. Reports suggest that board member Jitendra Jagadev privy to sensitive company information negotiated the deal on behalf of the buyer. This clear conflict of interest ignored by other investors has fueled accusations of unethical practices. Forgery And Governance Issues After Amrendra Sahu resigned investors allegedly forged his signature to finalize the sale. They transferred shares to the buyer before finalizing the Share Purchase Agreement (SPA) violating both SPA terms and shareholder agreements. Goldman Sachs one of the key investors allegedly delayed payments to Sahu under the SPA through unilateral extensions. Additionally the former CFO Sandeep Daga has yet to receive his dues a year after the investors were paid. Repeated requests for resolution have reportedly gone unanswered exposing a lack of accountability among key stakeholders. Legal Battle In Courts The matter has now reached the courts with the Odisha High Court set to review the case on January 9. The outcome could have far-reaching implications for investor-founder dynamics and corporate governance in India’s startup ecosystem. It serves as a cautionary tale of how poor governance and investor actions can undermine even the most promising ventures. As the case unfolds it may set a critical precedent for ensuring transparency and fairness in India’s entrepreneurial landscape.