AskMe Shut down Story

2016 witnessed another well Funded Startup called ASKME.

The Gurgaon-based online classified company’s majority investor Astro Entertainment Networks Limited (AENL) exited AskMe a few weeks before its Shutdown, due to disagreements with the minority shareholders.

AskMe had invested about $120 million and holding more than 97 percent stake in the company. But the minority shareholders allege that Astro is yet to pay Rs 300 crore to the company in dues."The company enrolled thousands of sellers to complete the orders they were receiving on Askmebazaar. At the time, written agreements were made with the seller which stated that payments would be disbursed in lieu of orders fulfilled by sellers within 15 days from the date of the items being dispatched. Not only did the company never fulfilled this, but they also went a step ahead and refused to clear our dues for the last four months," said a vendor on request on anonymity. He added that the company went on extending days for payments every now and then despite making various assurances.

Rough estimates suggest that the company owes the vendors dues ranging between Rs 100-150 crores.

Infact, another vendor claims that he wouldn't be surprised if the directors of the company ran away from the country without honouring the dues they owe to the vendors and to the 4000 employees.

The employees of Askme also have a similar story to tell. None of them have been paid their salaries since July. If that wasn't bad enough, they also received an email from Getit in the first week of August advising them to reach out to the management of Astro with their demands as the Indian arm of AskMe was in no position to pay them their salaries. The email listed the names, phone numbers and email ids of the Astro management team for the employees to contact. In fact, AskMe has written to the Ministry of Corporate Affairs and Registrar of Companies, asking them to ensure that Astro does not exit the country without meeting its liabilities and commitments.

AskMe has stated in earlier reports that these delays happened due to non-payment from Astro. Medianama has reported that Astro was supposed to pay AskMe $5 million by August 5. Apparently, AskMe had provided the names, phone numbers and email IDs of the Astro management for the employees to contact regarding payments.

In May 2015, AskMe acquired BestAtLowest for $10 million, and had celebrities like Ranbir Kapoor, Kangna Ranaut, and Farhan Akhtar endorse the brand. They had invested $20 million in online furniture player Mebelkart in August 2015.  In April 2016, furniture maker Housefull International had alleged that Mebelkart defaulted on payments and were selling imitations

Due to Mismanagement and internal problems Vendors, Employees are in trouble. This will be good lesson for Upcoming Startups and their managements to focus on  the core aspect of business expand the business only if it is necessary and required.

refereed through TOI and YourStory