This case raises concerns about corporate governance, workplace harassment and challenges faced by women entrepreneurs in male-dominated industries.
Zilingo, a Singapore-based B2B fashion tech startup, valued at $1 billion in 2019, is set for liquidation after a prolonged crisis.
The countdown to the company’s demise started during an AGM held on 10 February 2023, when the decision to initiate the dissolution process was made.
The process can take anything between 3 and 6 months.
The once-promising company is being laid to rest. Thereby hangs a cautionary tale, which is emerging in bits and pieces still.
But as the curtain drops on Zilingo—an ambitious attempt to bring together small traders of Southeast Asia on a unified e-commerce platform, spearheaded by 30-year-old Indian-born co-founder and former CEO, Ankiti Bose—it is important to consider some long-term perspectives.
It is also important, for India’s unicorn ecosystem, to consider the potential impact of personal conflicts and the influence they may have had and could have tomorrow, if it goes unchecked.
So, let’s go through part by part.
Although bits and pieces of information on the rise and fall of Zilingo and Bose have been reportedly and selectively fed to the public, the media narrative depicts a lopsided picture, with Bose tarred as a high-flyer who deliberately cultivated a high public image while committing “financial irregularities.”
Today, Bose’s professional and personal reputation has been tainted by what sources claim was a deliberate smear campaign mounted in mainstream media and social media platforms.
Top sources, however, say it reeks of personal vendetta. And now the plan to shaft Bose is coming out in the open like an orange peeled taken out from a refrigerator for peeling.
The reality is vastly different. Investigations show that reports in the media tell only one part of the downfall of Zilingo and the alleged involvement of Bose, in financial irregularities.
But now, as facts emerge, the truth cannot be hidden anymore.
So, let’s dig deep.
The Zilingo story can only be understood if the alleged role played by Shailendra Singh, the MD of Sequoia Capital India, in Bose’s suspension and eventual termination from the company she founded.
Top sources in India and Singapore say it is a dark tale of personal ego, driven without any checks within a mighty corporation, that seemed powerless to control him.
Singh’s rank and resources allegedly allowed his massive personal ego and hubris to become more important than the company’s underlying business principles. It seems that whistleblowers were weaponized, used, and misused, as they were at other times, ignored and eventually silenced.
It is surprising to see how Singh’s relationship with Bose transformed from a VC head honcho to a mentor-mentee dynamic with Singh taking an unusually keen interest in not only Zilingo’s operations but also its financial matters and even advising Bose about crucial decisions of hiring and firing key personnel.
Rare is the super-boss of a fund, whose schedule, forget responsibilities, allow this depth of involvement.
But this harmonious idyll was short-lived. Disagreements over both business and personal issues mounted. The final straw came when Singh suggested replacing Bose as CEO with a more experienced person, a proposal that Bose strongly rejected, given her youth and commitment, to the company she had founded.
The conflict that erupted between the two can be traced back to Singh’s insistence on the merger between Zilingo and Moglix, another of the giant Sequoia’s portfolio companies.
But Bose was opposed to the merger as she had already tied up a deal with Cartica, a well-known investment company based in Washington, DC. Bose, claim sources, firmly believed that the Cartica deal would have allowed Zilingo to continue building its own core business and brand without having to compromise in a merger, which she deemed was a better option than what Singh was proposing.
This description of events defines a situation which many startup founders flounder into. Funders and Founders conflicts are common, but this was, and in many unrecorded cases, excessive and toxic at a level which destroys value and companies. This was a classic playbook that has been too often told only by Funds, who are the survivors.
Consider this one. Bose was subjected to a campaign of harassment and retaliation, including suspension and termination from her position, based on false and baseless allegations made against her by a member of the company’s board and senior executives. A vicious whisper campaign was launched to tarnish her reputation, and her colleagues were warned to refrain from assisting her in any way. It was made clear to her that Singh, allege sources, would stop at nothing to remove Bose from her position in the company and smear her reputation.
So, what happened? A “whistleblower” complaint was filed against her. A witch-hunt was quickly underway, allegedly led by Singh and other board members and senior executives. The investigation process was allegedly littered with procedural irregularities and was orchestrated to achieve one result, Bose’s suspension, which happened on 31 March 2022.
But Bose’s harassment continued, with multiple breaches of her rights to due process and natural justice. Singh, it was clear to many, was not satisfied with her suspension but was firm on terminating her as CEO of Zilingo. The investigation of the so-called allegations against Bose was conducted by Kroll Associates, an investigations firm, and arranged by Singh despite a clear conflict of interest. Though he resigned from the board of the company on 10 April 2022, to avoid this charge, his replacement, Sandeep Kher, is a close subordinate of his who would carry out his bidding.
Ironically, most of the allegations against Bose were never even part of the original complaint and were the product of a fishing expedition by the company. Bose was terminated on 20 May 2022, and a press release was issued stating that following the findings of an “independent forensics firm that was commissioned to look into complaints of serious financial irregularities”, the company had decided to terminate Ankiti’s employment. To date, Bose, it needs a mention here, has not been provided with a copy of the initial complaint that was made to SCI against her.
Singh stepped down as a director from the company board even as the board failed to show Bose’s investigation reports on her alleged misconduct, despite being a director and large shareholder of Zilingo.
Even though other Sequoia investment companies like Trell and Zetwerk were plagued with financial and management problems, their CEOs were never asked to step down, unlike Zilingo’s Bose. This stark contrast only serves to underscore the unique and arbitrary nature of the issues at Zilingo, where rash and impulsive decisions seemed to fuel a misguided witch-hunt against its CEO.
The difficulties faced by a young entrepreneur were unique for Bose, as the pressures were vastly different. Singh’s break with Bose was not only due to management or financial issues of the company but also due to the revelation of explicit and covert sexual harassment by some senior members of SCI and people considered close to Singh. There are instances of officers at SCI who covered up such abusive behaviour and misconduct. Besides, Bose was shocked to discover that numerous companies within the SCI portfolio were implicated in severe regulatory violations and fraudulent schemes.
This situation raises serious concerns about corporate governance, workplace harassment, and the challenges faced by women entrepreneurs in male-dominated industries. The behaviour of Singh, and other members of the board and senior management, in conducting what appeared to be a baseless investigation, smearing Bose’s reputation, and violating her rights to due process and natural justice, is highly unethical and potentially illegal. The fact that Singh arranged the investigation himself despite a clear conflict of interest further exacerbates these concerns.
Despite the damage to both her reputation and the reputation of Zilingo, as well as incurring substantial financial losses, Bose has remained silent about it all. Bose has not spoken and Zilingo has been laid to rest, prematurely.
What sank Zilingo? It is the unbridled power of a senior executive to run a professional company according to his whims and abuse of power that comes with being the one who controls the purse strings by being a major investor.
The emerging narrative also raises questions about the nature of modern entrepreneurship and inclusivity, and the importance of having strong and independent corporate governance structures in place to prevent the abuse of power by individuals within a company. It also highlights the need to address the challenges faced by women entrepreneurs who dare to breach the bastions of an all-boys club.