Nestaway co-founder accuses Tiger Global and Goldman of fraud

Bengaluru-based Nestaway co-founder Amarendra Sahu has filed a first information report (FIR) alleging fraud, cheating, forgery and criminal intimidation against Tiger Global, Chiratae Ventures and Goldman Sachs. This is a rare case of a startup founder filing a criminal case. complaint against their investors.

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The investors approached the Orissa High Court seeking to quash the FIR filed in September last year against the Bhubaneswar police.

The next meeting in the case is scheduled for January 9.

Sahu’s complaint alleges that on June 28, 2023, his signature as a director of the company was illegally used to complete the Rs 90 crore sale of NestAway to tech firm Aurum.

He claimed to have resigned as a director on June 19, 2023 — more than a week before the deal was to close.

A copy of the FIR was examined Business Standard.

After the acquisition, NestAway’s valuation was reduced by 95 percent.

The firm was founded in 2015 and has raised $116 million in funding.

NestAway’s last round of funding took place in 2019, when it raised $220 million from well-known investors such as Tiger Global, UC-RNT Fund, Flipkart, Goldman Sachs and Yuri Milner.

An email request to Chiratae remained unanswered at the time of publication.

In the FIR, Sahu stated that due to the pandemic, the company suffered heavy losses as its operations were disrupted. Due to the pandemic and his elderly parents, Sahu has been working remotely from his home office in Odisha.

When the firm experienced serious financial difficulties, investors, namely Goldman Sachs and Tiger Global, left the board of directors to avoid personal monetary losses or reputational damage.

The other three partners, Jitendra Jagadev, Smruti Parida and Deepak Dhar, also left the firm.

“But I continued to work for the company without any financial benefit and due to my sincere efforts and dedication the company survived and was brought back to a viable state,” Sahu said in the FIR.

Sahu alleged that the investors, in collusion with Jitendra Jagadev, one of the directors, received a direct offer to sell their Aurum shares at a very low price without the involvement of Sahu and more than 250 shareholders.

Fearing that the deal might fall through, Sahu claimed that the investors convinced him to sell his shares and help sell the shares of others.

His complaint alleged that top investors convinced him through emails, WhatsApp messages and phone calls, assuring him of an additional Rs 11.72 crore on top of the value of his 5 per cent stake.

However, investors allegedly reneged on that promise after the deal closed.