- Zilingo board members suspended CEO Ankiti Bose amid a financial investigation, reports say.
- Investors are concerned about the startup’s accounting practices, Reuters and Bloomberg reported.
- Zilingo was founded in 2015 and reached a valuation of $ 970 million four years later.
A $ 970 million Singapore fashion e-commerce startup suspended its CEO after investors launched an investigation into the company’s accounting practices, Bloomberg and Reuters reported this week, citing unnamed sources.
Ankiti Bose, 30, co-founded Zilingo in 2015 with Dhruv Kapoor. In 2019, Zilingo raised $ 226 million from its investors, which pushed its valuation to $ 970 million, according to Bloomberg.
On Wednesday, Zilingo said his board members have decided to suspend Bose as an investigation into “matters” is underway, Reuters reported.
The company did not specify the objective of the investigation to Reuters, but unnamed sources told Reuters and Bloomberg that the investigation is related to the company’s financial and accounting practices. These include how the startup kept records of transactions and revenue, sources told Bloomberg. The company has avoided submitting annual reports since 2019.
Bose and co-founder Kapoor met in Bengaluru, India in 2014, where they shared an idea to help small players produce, buy and trade fashion clothing. They made Singapore the base of the company, Bloomberg reported in 2019. The Bose investigation and suspension threaten to derail Bose’s drive for the startup it co-founded to achieve unicorn status.
According to Bloomberg and Reuters, large investors from Zilingo Temasek Holdings and Sequoia Capital first raised concerns at its board of directors last month.
“Major investors have hired an independent company to investigate the matter and the company is working closely with major investors and the independent firm to investigate,” Zilingo said in a statement to Reuters.
Bose contested Zilingo’s board decision to suspend it and called it a “witch hunt,” according to correspondence seen by Bloomberg. The outlet was the first to report on the Bose suspension.
“We believe that our client’s suspension was achieved by invalid and faulty means; that the investigation initiated on her is unfair and lacking in due process and that she was suspended for no adequate and reasonable reason,” said the Bose attorney at Bloomberg.
A spokesperson for Zilingo declined to comment when approached by Insider. Bose and his attorney did not immediately respond to Insider’s requests for comment.
Zilingo has offices in Singapore, the Philippines, Vietnam, Thailand, Cambodia and India, according to Bloomberg. In 2020, the company fired dozens of employees from its 900-strong workforce as Southeast Asia imposed COVID lockdowns, according to a company blog post and an earlier Bloomberg news report.
With the reopening of these economies, Zilingo expects better financial results in the fiscal years to come. At the end of 2021, it predicted that main net revenue would increase from about $ 40 million for that fiscal year to about $ 60 million in fiscal year 2022, according to documents seen by Bloomberg.