On January 19, Ashneer Grover, co-founder and Managing Director (MD) of fintech firm BharatPe, went on a “voluntary leave of absence” till the end of March. As per the company’s statement, “Ashneer Grover, our co-founder and MD (managing director), has today informed the Board of his decision to take voluntary of absence from BharatPe till March-end. Ashneer had co-built BharatPe from scratch, and his decision is consistent with his passionate commitment to the future success of the company.”
It is being alleged that his leave of absence is linked to the audio clip of him abusing an employee of Kotak Mahindra Bank that had surfaced on social media platforms a couple of weeks ago, though it has not been officially confirmed.
Reports suggest his decision to go on voluntary leave was accepted by the board of directors of the company. The board and Ashneer agreed it would be in the best interests of the company, employees and investors. It is notable that since his audio had gone viral, netizens have been discussing the alleged toxic culture at BharatPe and his caustic behaviour on the reality show Shark Tank India.
According to a report in Money Control, the board of directors of BharatPe, investors from Sequoia India, Ribbit Capital, Coatue Management and senior bankers, including ex-SBI Chairman Rajnish Kumar and ex-Union Bank Chairman Kewal Handa, had unanimously insisted Grover to go on leave of absence. Money Control quoted an unnamed person familiar with the matter, saying, “The board was not in favour of firing him and wanted the media dust to settle. They wanted to give him time to settle down and get rejuvenated. This is a personal issue and not a professional one to fire him on.”
Ashneer Grover’s statement
In a statement released on Twitter, Ashneer said, “I’ve been relentlessly at work building up BharatPe for almost four years. After much deliberation and introspection, I plan to take a temporary leave of absence from BharatPe till March-end. I will return on or before April 1 2022. I’ll be utilising this period to rejuvenate and refresh myself for our next sprint of value creation.”
On leave. Back on 1st April pic.twitter.com/qzD2Ot4OD9
— Ashneer Grover (@Ashneer_Grover) January 19, 2022
He further added he would use the time to think about the next phase of product development. He said, “I expect to spend the time thinking more deeply about our next phase of product development and BharatPe’s path to profitability and IPO. I will also double down on investing in myself personally. I am a builder, and I know my energy is best spent creating value for the millions of Indians we serve each day.”
He said, “We’ve, at BharatPe, delivered 40 months of absolute growth and have an exceptional team of professionals who have built BharatPe, PostPe, 12% Club and PayBack. The team is passionate about solving the financial needs of small merchants and credit-seeking customers, and I am excited about what we plan to build at UNITY SFB with our partner Centrum. I am confident that under the leadership of our existing CEO, Suhail Sameer, the team will continue to deliver.”
The abusive audio call between Ashneer and Kotak employee
On January 5, an anonymous person tweeted a link to a now-deleted audio clip from Soundcloud, an audio hosting platform. In the clip, there was a conversation between a bank employee and two customers over the inability of the bank to finance their application and buy shares of FSN E-commerce Ventures that runs cosmetics platform Nykaa. The bank employee was heard trying to calm down the two customers over the call. The customers could be heard using abusive language. The audio was deleted from SoundCloud but was uploaded by others on different platforms including YouTube.
When the audio was made public, it was alleged that the bank employee was from Kotak Mahindra Bank and the customers were Ashneer and his wife, Madhuri. The customers not only used alleged abusive language but also threatened the employee.
The audio went viral on social media platforms, and the next day Grover issued a statement on Twitter alleging it was fake audio. In his statement, he alleged someone tried to extort money, and when he refused to pay, the scamster published fake audio of him. In the now-deleted tweet, he said, “Folks. Chill. It’s a fake audio by some scamster trying to extort funds (US$ 240K in bitcoins). I refused to buckle. I’ve got more character. And Internet has got enough scamsters.”
Things turned sideways when on January 9, Kotak Mahindra Bank issued a statement in the matter and said they were pursuing legal action against the couple over the abusive language they used during the conversation with their employee.
Grover, who had worked as the vice president in Kotak Investment Banking for seven years till 2013, had sent a legal notice to the Kotak group on October 30 last year. In his notice, sent via his law firm Regstreet, Grover had alleged that Kotak Wealth Management failed to finance his and Madhuri’s application for Nykaa IPO.
The notice added the Bank’s refused to comply with the assurances on the pretext that the bank did not want to finance the IPO due to ‘erratic FII movements’ and ‘very high lending rates. In the notice, Grover sought compensation from Kotak against its failure to provide IPO finance and allocate shares worth Rs 500 crores before the offer closed on November 1, 2021.
The notice read, “Kotak’s refusal to provide IPO financing to our clients at the eleventh hour has completely crippled our clients’ ability to participate in the Nykaa IPO and deprived them of a business/investment opportunity about which they had informed Kotak more than a month in advance of the launch of the IPO. Had Kotak informed our clients at the very beginning that it would be unable to provide IPO financing for the Nykaa IPO, our clients would have approached other financiers who were ready and willing to provide IPO financing to our clients for this IPO.”
Kotak Mahindra Bank, however, denied any breach of trust in any manner whatsoever in its January 9 statement. The bank said, “This notice was received by us and was replied to appropriately at the time, including placing on record our objections to inappropriate language used by Grover. Appropriate legal action is being pursued.”
. @KotakBankLtd says, ‘This notice was received by us and was replied to appropriately at the time, including placing on record our objections to inappropriate language used by Mr. Grover. Appropriate legal action is being pursued’ pic.twitter.com/Av4W9tkPGs
— CNBC-TV18 (@CNBCTV18Live) January 9, 2022
Suhail Sameer, a consumer goods veteran who joined BharatPe in 2020 and became its CEO, along with co-founder Bhavik Koladiya would continue to manage day-to-day operations at the company. Notably, when Sameer was appointed as CEO, Grover was asked to concentrate on the company’s reputation, oversee fundraising and plan the future of the company. Sameer is also a board member at BharatPe.
