Singapore-based B2B start-up, Zilingo has fired its co-founder and CEO Ankiti Bose after the board initially suspended her on March 31 on allegations of financial irregularities, and other accusations of inflating revenues on the company books.
Bose’s suspension came after a whistleblower within the company informed the board and shareholders of alleged financial wrongdoings that have taken place in the last two years which allegedly involved Bose. Zilingo subsequently opened an investigation into the company’s accounting practices and appointed a third-party consulting firm to conduct a forensic audit in April.
On Friday, Zilingo said that the investigations led by the forensics firm have concluded while indicating that the company may launch further legal action.
“Following an investigation led by an independent forensics firm that was commissioned to look into complaints of serious financial irregularities, the company has decided to terminate Ms Ankiti Bose’s employment with cause, and reserves the right to pursue appropriate legal action,” the statement said.
The B2B start-up, which offers a tech platform for fashion retailers to source wholesale supplies, has been one of the most celebrated start-ups to emerge from SEA geography. Zilingo has raised around $340 million in equity and debt financing to date from prominent investors, including Temasek Holdings, Sequoia Capital India, Burda Principal Investments, and many others. It was last valued at around $900 million in a funding round in February 2019.
Bose has been refuting all allegations against her. In a statement on Friday, Bose said, “I have been suspended for the last 51 days on the basis of an anonymous whistle-blower complaint, and today I am informed that my employment has been terminated inter alia on grounds of “insubordination”. I was suspended on the basis that the company had instructed Kroll (law firm) to investigate the complaint. I have neither seen the Kroll nor Deloitte reports and have not been given sufficient time to produce any documents requested by them. Any report that comes out post my termination would be vitiated as it seems to be instructed by conflicted parties and we will pursue our rights against this witch-hunt to the full extent of the law,” Bose added.
The statement from Zilingo said several days after her suspension on March 31, Bose brought to the board’s attention, for the first time, certain harassment-related issues pertaining to past time periods.
“A top consulting firm was appointed to look into the claims of harassment brought to the board’s notice by Ms Ankiti Bose. The investigation has concluded that the company took appropriate action and followed due process to address these complaints that were brought to their notice, contrary to media reports that have suggested that the suspension and investigation into Ankiti Bose were aimed at suppressing the said harassment claims,” the statement added.
Zilingo further added that the company is “deeply pained and disappointed to see the manner in which the board, investors and employees have been constantly attacked through ostensibly leaked and fake information, along with what unfortunately appears to be paid and defamatory social media campaigns throughout the investigation period”
“This has caused irreparable damage to the company, the board, employees and investors,” the statement added.
On May 13, Zilingo’s creditors had decided to recall their entire loan, which prompted the start-up to appoint a financial adviser to evaluate options to deal with the default. In a statement on the same day, Zilingo’s board said that “due to Zilingo’s failure to fulfil prior obligations under the loan agreement, the company’s lenders have made the decision to accelerate the repayment of the entire loan”.
FE reported on Tuesday that Zilingo’s co-founder Bose had explored recompensing the company’s entire outstanding debt worth $40 million. This would have provided her with an option to gain more equity in the firm, two people aware of the discussions said.