In a recent development in the Stayzilla case, the Supreme Court has given an interim order of status quo in an appeal against the insolvency proceedings of the homestay aggregator. The order thus freezes the insolvency resolution process (IRP) ordered by the National Company Law Tribunal (NCLT) in September this year.
The National Company Law Tribunal bench in Chennai had ordered the initiation of insolvency proceedings against defunct homestay network StayZilla two months ago. The startup became a nationwide sensation in June 2017, when Yogendra Vasupal, CEO and co-founder of Stayzilla, was arrested on charges of fraud for about $265K (INR 1.72 Cr) by Jigsaw Advertising Agency.
But last week, hearing the appeal filed by Stayzilla founder Yogendra Vasupal, a two-judge bench at the apex court granted a week’s time to respond for advertising vendor Jigsaw Solutions and a week’s time for a rejoinder before listing the case for further hearing. Till that time, both parties have been ordered to maintain status quo.
Stayzilla And The Insolvency Proceedings
Founded in 2005 by Sachit Singhi, Yogendra Vasupal, Rupal Yogendra, as Inasra, and later rebranded as Stayzilla in 2010 – the platform acted as a marketplace for homestays and alternate stays in India, with around 55,000 stay options across 4,500 towns in the country.
The platform catered to both homeowners and travellers looking for differentiated, unique stay experiences. Yogendra founded the company with his wife Rupal Yogendra and his friend Sachit Singhi.
Initially, funded by Indian Angel Network with an infusion $500K in Seed round, Stayzilla had raised an undisclosed Series A in 2013. It got further funding in 2015 when Nexus and Matrix put in $20 Mn in Series B and later $13 Mn Series C in 2016. The startup competed with Fab Hotels, Yatra, OYO, Airbnb, MakeMyTrip and others.