World Startup Convention: Inside The Fyre Festival Of The Indian Startup Ecosystem

Update: After our story was published, Ankur Warikoo sent a statement to Inc42 explaining his involvement with the World Startup Convention.

The full statement from Warikoo has been added below.

---

Halfway through the opening day of the World Startup Convention, a throng of founders had crowded the stage. But these founders weren’t looking to pitch to investors, instead they had gathered around at least a dozen Uttar Pradesh Police officers at the India Expo Centre & Mart in Greater Noida.

If there were already red flags around the so-called ‘world’s biggest funding festival’ as we reported in our in-depth investigation, then this scene more or less confirmed that this is the Fyre Festival for Indian startups.

Inc42 visited the venue on the opening day of the World Startup Convention, and on arrival we saw angry crowds, the organisers being shielded by police and none of the fanfare that had been promised over the months in social media campaigns.

For the hundreds of attendees at the World Startup Convention, the dozens of startups who were exhibiting at the event, and some of its sponsors, this was their worst fears coming true.

This is a story of the consequences of the misleading marketing by the World Startup Convention, unverified claims by startup influencers and how they have dented the trust in startup events and caused pain to the young students and founders aspiring to be part of this ecosystem.

Sponsors Mull Legal Action

While many attendees had paid between INR 6,000 to INR 8,000 for the three-day WSC pass, the situation was significantly more serious for sponsors such as Bambrew and its founder Vaibhav Anant.

The Bengaluru-based D2C brand which makes sustainable packaging, spent over INR 50 Lakh to become a sponsor for the World Startup Convention. Now, Anant is preparing to take legal action, even with two days of the event still to go.

“As soon as I arrived at the venue it was clear that this was nothing like what was promised to us. I am going to take legal action and I am naming everyone involved from Luke Talwar and Arjun Chaudhary (founders of World Startup Convention) to influencers such as Ankur Warikoo and others who posted about the event,” Anant told Inc42.

He came across the World Startup Convention last year and bought eight passes for his team in the hope of getting some valuable networking opportunities with investors.

“I spent INR 48,000 for the passes, close to INR 10 Lakh for the stall and INR 40 Lakh or so for the merchandise, stall design and sample development because we were made to believe tens of thousands of people will show up,” Anant told Inc42 after what he called a harrowing day for his team.

Ten of the startup’s employees made the trip from Bengaluru and at one point, the company was supposed to even provide the cups and glasses for the event, which would have involved more costs. “I primarily believed them because they used the names of political leaders and even the PM for the promos. But beyond this, there were videos by credible startup founders too,” the Bambrew founder added.

The Bambrew founder said he brought up the issues after arriving at the event, but his concerns were rebuffed by Talwar. Luke Talwar and Arjun Chaudhary are the founders of Qofunder Private Limited, the company that has organised the World Startup Convention.

Like others that Inc42 spoke to, Anant pointed out that such episodes cause reputational harm to the startup ecosystem and can even lead to startups shutting down. The D2C startup has raised close to $3.5 Mn (INR 28 Cr) since inception in 2018, but Anant believes some startups cannot afford to spend even a tenth of what he did.

“This is a tough year so you can imagine how much of a blow this is for us. We will do whatever it takes to get back some of the amount we have spent,” he added.

Anger In The Audience 

Besides Bambrew, the World Startup Convention also had sponsors such as Builder.ai, Coffeemug.ai and a host of other smaller exhibitors. And we also spotted a handful of angel investors attending haphazard pitches circled by crowds of people.

Even before our arrival, we were sent messages on Twitter about the lack of organisation and of course the failure to deliver on many promises. And when we reached Greater Noida, there was no dearth of complaints.

We spoke to around 15 attendees across age groups from students to solo founders and others who have already raised funding. Some of these had made their way to Noida from Chennai, Hyderabad, Surat, Darjeeling, Nashik and other places in India. Many were students, whose parents had paid for a three-day trip to the other side of the country. Others were young founders who also claimed to have been influenced by videos on social media.

“I’m just a third-year student and I wanted to experience a networking event, but as soon as I got here, it seemed to be a hoax. There was no security and they let me in without actually scanning my pass,” said an attendee from Chennai.

Nashik-based Aditya Nagare, the cofounder and CTO of fintech startup TrustPe, said he spent close to INR 60K on the trip to Delhi and his three-day stay in Noida. Nagare was hoping to strike conversations with investors and pitch his startup in escrow accounts management space.

Nagare claimed that while there were a few investors at the World Startup Convention, pitching to them meant talking in public about the idea and the startup’s numbers.

“Plus, you have to fight twenty other people to get five minutes in front of the investor. There was no planning or organisation in terms of the pitching time,” he said.

In its ad campaigns, the event had boldly hinted at the participation of global tech personalities such as SoftBank’s Masayoshi Son, Tesla’s Elon Musk and Alphabet’s Sundar Pichai, and investors such as Sequoia and Tiger Global.

Delhi’s Sarthak Manchanda, cofounder of Smart Diet Planner, did get some time to pitch to Aman Dasot, an Indore-based real estate developer and angel investor. But even he was uncomfortable with sharing details about his business as others watched on and even recorded him. “I wish there was a better format for pitching where we could be behind closed doors and even have some chance to ask the investor some questions,” Manchanda told Inc42.

Of course, others in the audience were not even as fortunate as that. One common complaint was that there was not even any drinking water available for the attendees, nor was any food provided.

Hyderabad-based Pratik Padamwar, cofounder & CEO of 100X.VC-backed MetaBrix Labs, said none of the scheduled panel discussions took place, and there was no public address about the lack of organisation and planning for the pitches. The lasting impression of the first day for Padamwar and others was the police presence.

Inc42 has seen a private video of police escorting Talwar away from the venue, where some officers tell the audience that he’s been taken to a police station. So what exactly happened at the venue that brought the police onto the scene?

Police At The World Startup Convention

Inc42 could not independently verify the source of the police complaint. Although officials were present at the scene, the sheer chaos of it all and the fact that they had to deal with hundreds of complaints meant there was very little in terms of official comments.

We know that the personnel on the scene were from the Knowledge Park Police Station and that the case was being looked at by the Additional Deputy Commissioner of Police Dinesh Kumar Singh. However, the ADCP declined to give an official comment.

The police also declined to state the number of people who had submitted a written complaint, which could become part of the official FIR if one is filed. Inc42 has reached out to the ADCP and Deputy Commissioner of Police in Greater Noida for more clarity on the situation. The story will be updated as and when a response comes.

But we do know that the police had become the focal point of attention for many of the attendees of the World Startup Convention. By the end of the first day, the police were greater in number than the startups exhibiting at the event.

Influencers Under Fire

While much of the anger at the World Startup Convention was directed at the organisers Talwar and Chaudhary, it was hard to miss the discontent when it comes to influencers and their unverified claims. On social media, too, several attendees claimed they felt cheated by the event and blamed the likes of Warikoo, Shamani and others. The organisers had roped in the likes of Ankur Warikoo, Raj Shamani, Chetan Bhagat, Prafull Billore for influencer marketing of the event.

In many ways, those who promoted the event were promoting the financial upside of attending it. One of the biggest exaggerations in their videos is about startups being able to raise Series A and B rounds at WSC.

These deals typically take months and they usually do not happen in public events such as this. ‘Open mic’ pitches such as the ones we saw today are usually reserved for pre-seed or seed rounds. So in essence, influencers making these claims were misleading startup founders about a financial service of some kind.

Similarly, promotions for the World Startup Convention boasted 75K startups and 9,000 investors would be present at the event, which was also an untrue claim.

After our story was published, Warikoo told Inc42,

“1. I am not involved in the conceptualizing or organizing of the event
2. We had done an Instagram collab reel on 19th January where I spoke about the importance of funding for a startup and how this event could be a good opportunity to explore the same and meet other founders.
3. The terms of the collab were clear that my video will NOT be used for promoting the event. However, I realized that this was not respected. While they took down ads of the video when we asked them to, the video was still used on their website and in all of their communication.
4. In January itself we distanced ourselves from the event. They repeatedly asked me to be present for the event, which we declined.
5. As late as Feb we had to keep sending them emails asking them to take down ads they were running to promote the event using my video.”

The former CEO of Groupon India and cofounder of Nearbuy has over 2.7 Mn followers on Instagram and Twitter combined.

Shamani also responded to Inc42 after the article was published and stated that he was supposed to do one video for Instagram but this post was then reused by the WSC team. Shamani said his team contacted World Startup Convention in February to take down the posts that used his video for promotions, but never got any response.

But there could be repercussions in the future for influencers and unverified claims such as the ones we have seen in this instance. Regulators have looked to focus on this space in recent months.

Consumer Affairs Ministry’s new rules state that social media influencers would be liable to pay a fine of up to INR 10 Lakh for violation of guidelines related to disclosures and material connections, which can go up to INR 50 Lakh for repeated violations.

SEBI is also reportedly looking at mandating registrations for social media influencers, on the lines of rules governing registered financial advisors.

Perhaps these rules need to be extended to promos of such funding events because this is one kind of financial incentive being promoted.

About the influencers, Anant was scathing, “You have some influence and credibility. People look up to you. You should have been careful. You are an idol for young founders.”

MetaBrix’s Padamwar believes that the reputation of many influencers is on the line. “How can they claim to be idols or role models, when so many young students and founders have spent their hard-earned money to get nothing.”

As for the organisers, it’s not clear whether any action will be taken against them. But one thing we know for sure is that the next startup event will have a hard time convincing anyone of its legitimacy.

For inexperienced founders who are desperate for funds to build their startups or start their entrepreneurial journey, this is a tricky time. The limelight on startups through mainstream properties such as Shark Tank India has made it easy for dubious platforms and commission-based models to find traction. There’s hardly any protection for founders and there is no dearth of stories of founders falling for these traps.

“They [World Startup Convention] have ruined a lot of the good work that Indian startups have done. Now people will have less trust in startup events and founders,” Bambrew’s Anant added.