Seems good times are over for the online retailer Yebhi.com, after the co-founders leaving the company, Nikhil Rungta, Chief Business Officer whom Yebhi had hired last year, has also left the company. The rumors of Nikhil resigning from the post were in the air, when we previously covered the story “[Rumor Hill] : Yebhi On the Road To Closure.’’
Though Manmohan Agarwal and Nikhil Rungta, both completely and strongly, falsified any speculations of Yebhi shutting down or Nikhil leaving the company, when Inc42 Magazine earlier spoke to them.The company simply denied thus ending the story as being a pit of rumors, but looks our investigation and information was not that wrong.
According to a source close to the devlopment, “Yebhi.com management was trying to get funding from last 6-7 months. But in January, investors told them very clearly that they are not going to give any more fund. On 28th January, 2 directors left the company and management decided to issue pink slip to almost 80% staff.”
“Vendors and ex-employees are crying for payments and salaries. Few employees are still waiting for their December salary and all of us are waiting for our full and final amount. Every week management is giving a new date to us but not clearing our dues. Vendor Payments – Generally payment term for vendors is 30 – 60 days credit. Few vendors supplied goods 6 months back but still waiting for payment,” said an ex-employee of the company.
The company had asked a number of its employees to leave immediately citing the reason that they were the most salaried employees among the team and the company wanted to reduce the company cost.
In the past few weeks, we have been approached by numerous employees from Yebhi who shared the same scenario within the company. At the time when employees were asked to leave, the company had assured that the pending salaries will be issued in sometime, however, employees are yet to receive salaries. Few of the employees have even sent the legal notices to the company for pending salaries.
The situation in the company is even visible on its social media panels, while looking at the social media pages of the website we found that on Twitter there has been no update since March 5th, and on Facebook there has been no update since February 19.
Adding on, there has been a drastic fall in companies traffic as well.
Since last year, Yebhi has been looking to raise $30 Mn in funding, failing to raise funds is said to be the main cause of the situation like this which has now arrived. Even Raul Rai, MD of Fidelity, and Suvir Sujan, co-founder of Nexus Venture Partners who had joined the boards of BigShoeBazaar Pvt Ltd had also left the boards of the company last year.
Also, as per reports Nexus and Catamaran might have written off investment in the company, though Manmohan has communicated that there is no formal communication that he has received.
Throughout, on this situation, Yebhi has been saying that they are now not looking to raise funds and they don’t need any further investment, they are re-organising their cost structure to ensure that the company do not depend on future funding rounds, but the current situation in the company shows a different picture.
Adding on, IRCTC which had ventured into ecommerce by partnering with Yebhi last year via White Label Model, is now reportedly exploring new partners for the platform and is expected to float a new tender soon for the same.
The fall of ecommerce in India is not at all a new story, on one side there are retailers who have managed to gain big rounds of funding including Myntra, Snapdeal, Jabong, Firstcry, Flipkart etc. on the other side there are players like Hushbabies, 21Diamonds.in, KoolKart.com, Rock.in, Wopshop.com, SeventyMM etc that have closed shops in past months.
Yebhi was launched in 2009 and was Cofounded by Manmohan Agarwal, Nitin Agarwal, Rajul Jain and Danish Ahmed. A few weeks back, Nitin Agarwal and Rajul Jain, had left the company. Last year, Yebhi had raised Rs 60 Cr in a funding round. Previously, in July 2012, it had raised Rs100 Cr in Series C, before that it had raised Rs 50 Cr and had also acquired online jewelry portal Stylishyou.in for over $1 Mn, in a cash-and-equity swap deal.