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Not Just Tenants, Homigo Founders Swindled Money From Employees Too

Not Just Tenants, Homigo Founders Swindled Money From Employees Too

Founders are allegedly on the run after INR 20 Cr fraud

The founders kept employees blindsided stating funding will be coming soon

Few employees had personally invested in the company last year

Police to hand over the case to CCB

“We (me and my colleague) have received anticipatory bails, but it has been three weeks that we are being called to one police station to another for enquiries. So, we are busy clearing our names now, for the fraud which we never did,” one of the employees of Bengaluru-based coliving startup Homigo, who did not want to be identified, told Inc42.

Since the disappearance of Homigo founders — Nikunj Bhatija, Jatin Mitruka and Aakash Verma — with an alleged fraud of approximately INR 20 Cr in funds from user deposits, rents, employee salaries etc. — the police complaints filed against the company and its team has left several of its employees in jeopardy.

Besides, multiple police complaints been filed against the company’s employees, an FIR has also been filed against three employees. And they are not just facing a backlash from the police and Homigo tenants but have also been left in losses in terms of their personal investments into the company’s fund and backlog salaries.


Salary Is Least Of The Concern Here

Founded in 2015, Homigo employed a team of 20 (as of February 2019), and according to employees apart from salary, they are facing serious monetary issues due to this entire fiasco.

An employee with whom Inc42 spoke with told us about the company’s fund in which a couple of employees had personally invested. He said, “There are employees who have put in their own money into the company. I have taken two loans to add INR 4.5 lakhs to the company fund while a colleague of mine has invested INR 7 lakhs.”

According to him, there are around four to five senior executives who had put in their personal money into the company in May last year. This was a time when the company was going through a growth phase and was chasing high revenue targets to raise the next round of funding. And this led a couple of employees to make a personal investment into the company.

“The company was in talks to raise around INR 14 Cr – INR 28 Cr ($2 Mn – $4 Mn) funding and we were chasing targets of INR 1 Cr revenue per month from INR 40 Lakhs at the moment. We trusted them (Homigo founders) and all we got is the stab in the back,” he said.

Now, these employees are forced to take another loan, just to survive and manage their expenses. One of the employees even added that between — police FIR, anticipatory bails, loans, and other commitments, he and his colleague have together lost anywhere between INR 10 Lakhs – INR 12 Lakhs.

At the same time, they are also morally obliged to pay to the vendors connected to them. They are helping people like DTH vendors, painters, electricians who have payments pending somewhere between INR 60K to INR 2 lakhs.

“As I and my colleague are receiving salaries from our ongoing jobs, we are trying to pay of the debts of a few vendors who are really in a problem. We can manage as we have got a 10% hike in salary and we are passing that money to the company,” an employee said.

One of the employees even said that people are still accusing the employees on the social media creating an atmosphere of terror among all.

As alleged by tenants, since the last two months, the Homigo team has not been replying to tenants’ complaints about poor living conditions, shortage of water and electricity and other needed commodities in their apartments. Thus, multiple complaints were filed against the founders and several employees at Bellandur, Mico Layout, HSR Layout and Jeevan Bhima Naga police stations.

Last week we had reported regarding the fraud of being INR 30 crore, further investigation into the matter and discussions with the parties involved showed that the amount is closer to INR 20 crore.

Breach Of Trust

In our discussions with multiple employees, we also found that a few of them were looking to move out of the company from the past couple of months. One of the employees also informed us that a few had received job offers between November 2018 to February 2019 and they had resigned from the company. However, their resignations were not accepted by the Homigo founders and they convinced them to stay with the company till March 2019.

“I resigned in Nov 18, as I had a better job offer. In January, Nikunj requested to stay and said that the company will soon get funded. In February, I got another offer and I want to move on. But they asked me to stay for another 20-25 days and got it delayed till mid of March,” one of the employees interviewed by Inc42 said.

According to the reports, a few of the Homigo properties were rented out to NestAway and the acquisition talks were also in place. The Homigo founders even admitted to the team that acquisition talks in place and they are looking to close a funding round by March 9-10 as well.

However, none of these deals went through, and after the scandal broke, NestAway denied taking any responsibilities towards the deposits made by the tenants to Homigo.

While the maximum employees have now been able to find another job, they believe the founders have breached their long-earned trust.

“Most of the employees here are working for more than two years. We are the people who have seen the company grow from the worst of its times, come out of it, and grow again. It is very hard emotionally,” he added.

The case is now said to be getting transferred to CCB. Detailed coverage of the case done earlier by Inc42 can be read here. A number of Homigo employees are also helping Bengaluru Police in the investigation.

Irrespective of whether Homigo’s founders are guilty or not, Homigo employees have gotten entangled in a situation that they did not ask for but are still having to pay for dearly. While the startup ecosystem attracts some of the best and ambitious minds in the country, if allegations against Homigo are true, the trust by which employees join startups may be irreversibly shaken.