Ashneer Grover: The Chronicles Of ‘Doglapan’

February 19, 2022: Exactly a month after Ashneer Grover announced a ‘temporary leave of absence’ from BharatPe on social media, the spouses of two senior executives from the fintech unicorn received an alarming message on WhatsApp.

These texts alleged that the executives were having extramarital affairs and set off mild panic among the recipients. The messages, we were told, were sent by Madhuri Jain Grover, Ashneer’s wife and still the head of control at the company at the time.

“You can imagine the plight of the spouse after seeing this message late at night. This was emotional warfare,” according to a BharatPe employee who was shown these messages by one of the two executives.

Thus began a war of intimidation, misinformation, threats and lies that has gone on unabated for nearly 16 months now. It has even turned personal at times, with unabashed attacks from Grover against pretty much everyone at BharatPe.

The Ashneer Grover and BharatPe tussle might well go down as the dirtiest battle in Indian startup ecosystem history. But the fact is the story is far from over.

In early May, the company’s criminal complaint against the Grovers and members of Madhuri’s family was registered by the Delhi Police’s Economic Offences Wing. The FIR alleges a fraud of INR 81 Cr by Madhuri, Ashneer, Madhuri’s father Suresh Jain, her brother Shwetank Jain and her brother-in-law Dipak Gupta. And in response, Grover almost immediately and dramatically claimed that the company is a $3 Bn write-off.

On the sidelines, many of Ashneer’s claims after the FIR have since been deleted from his social media accounts after BharatPe’s interim application for defamatory content was resolved in the Delhi High Court on May 26, 2023.

But Grover’s rather public attacks on the executive rank of BharatPe, its directors, and investors is all too familiar for those who have been tracking this story over the past couple of months. He also admitted to ‘being in the gutter’ in the Delhi HC hearing this week.

Ashneer Grover does not hold back, except when Inc42 requested him and Madhuri to speak for this story.

In the absence of any response to our text messages and emails, we have to relay this story as told to us by multiple current and former employees of the company and those who were privy to internal information.

In public, the Grovers have doggedly defended the charges of misappropriation of funds, payments to non-existing vendors and HR recruiters as well as serious charges of embezzling funds from the company. But our investigation and information received from sources show a pattern of deception and cover-ups in the immediate aftermath of the controversy.

It bares what happened at the company in the days after Grover’s leave of absence and how the couple fought back and looked to obfuscate the trail of the fraud that BharatPe has alleged.

Our story also goes beyond the operational mess to uncover the selling tickets of cricket matches in the UAE for personal gains, purchases of luxury apartments in Delhi NCR, exaggerations about creating unicorns.

These details and the rising public profile of Ashneer Grover raise serious questions about what kind of role models are needed in the Indian startup ecosystem.

This is the untold story of Ashneer Grover’s last stand at BharatPe.

The Start Of The Fall

As we know well by now it all began with a leaked audio clip on Twitter in the final days of 2021, swiftly disputed by Ashneer Grover as a fake recording.

Grover, who was still the managing director of BharatPe at the time, is allegedly heard hurling abuses and threats in the clip which has been scrubbed from the internet in the ensuing legal battle with Kotak.

The clip was at first dismissed as fake by Grover, but it did see a response from Kotak Mahindra Bank which pretty much authenticated it.

Grover had looked to sue Kotak for failing to deliver financing to invest in the Nykaa IPO, and Kotak’s reply said the bank is also taking note of the abusive language used by Grover in his communications.

Besides, Ashneer Grover had also confessed to using abusive language on calls with Kotak to some senior-level employees at the fintech unicorn, sources told us.

The audio clip brought more spotlight on Grover’s outspoken and often brash nature, a reputation that grew after his stint on Shark Tank India’s first season. It also made him a cult hero of sorts, and the spotlight still follows Grover around despite the BharatPe allegations.

Board Games: BharatPe Vs The Grovers

As the Kotak controversy bubbled over, in a heated board meeting on January 19, 2022, Grover first offered to resign, our sources told us. Instead, the board sent him on a leave of absence pending inquiries.

The board is said to have counselled Grover to take time off till the spotlight from the Kotak controversy diminishes, but Grover claimed he was willingly stepping away from the day-to-day responsibilities, even though it was the board’s decision.

Ashneer continued to be a director in the company even then and in a board meeting the next day, he told directors that his wife Madhuri Jain Grover would also resign from the company if there was any suspicion of wrongdoing.

It’s unclear why Grover made this claim, but it is curious nonetheless. At that time, there was no discovery of fraud; everything till then had only been about the Kotak audio clip.

Of course, we now know Madhuri’s dismissal a month later had nothing to do with the Kotak controversy, but for allegedly defrauding the company.

After her dismissal, Madhuri claimed it was unlawful and also denied offering a resignation, which was partly true since it was Ashneer that had offered it to the board on her behalf.

In the month between the individual dismissals of the Grovers, the board found clear evidence of fraud. Whistleblowers stepped forward after Grover’s dismissal with more serious allegations sources added. And the board was able to find evidence to corroborate these claims. within 48 hours of the complaint coming up and less than a week after Grover was asked to go on a leave of absence.

Of course, the Kotak controversy is all but forgotten now and the focus is squarely on the fraud. Interestingly, BharatPe has put Madhuri at the centre of the alleged fraud.

Decoding Madhuri Jain Grover’s Role

While the spotlight has undoubtedly been on Ashneer Grover in the aftermath of the controversy, BharatPe’s complaint names Madhuri Jain Grover as the ‘No. 1 Accused’.

Madhuri is alleged to have been instrumental in making payments to fake vendors and raising invoices because all one-time passwords from banks for all transactions at BharatPe came to her phone number. She is also said to have carried out all transactions claimed in this fraud.

The allegations range from embezzlement of funds and payments to bogus vendors to personal spending from the company books:

Sources who were in the finance team and part of the governance audit told us that Madhuri made reverse ledger entries to return payments received from various vendors once the review began. This was allegedly done on the pretext of repaying personal loans to the vendors who BharatPe alleges in its complaint are non-existent.

Besides this, much of the personal spending or double spending for travel etc is alleged to have happened through accounts connected to the Jain family. However, even as the governance review was ongoing, there was a lot of pushback from the Grover duo.

In mid-February, BharatPe dismissed Deepak Gupta, which was soon followed by Madhuri’s dismissal after a board meeting on February 22.

This timeline is important because it shows that even before her dismissal, Madhuri had begun the misinformation war with the two inflammatory WhatsApp messages (February 19). It was not the last attempt at derailing any potential investigation.

By February 2022, Ashneer had also moved to the Singapore International Arbitration Centre to protect his stake in the company, and alleged lack of due process in the internal investigation. The SIAC dismissed these in its emergency award, a copy of which Inc42 has seen through secondary sources.

Ashneer then resigned from the company on March 01, 2022 and a day later, the company, for the first time, publicly alleged embezzlement by the Grovers to fund their ‘lavish lifestyle’ — and it’s not about the much-talked-about INR 10 Cr dining table. There’s a lot more than INR 10 Cr at stake here.

The Grovers’ ‘Lavish Lifestyle’

Sources close to the company also alleged that the Grovers had purchased properties in Delhi and Gurugram. In South Delhi, the Grovers reside at N Block, Panchsheel Park in a second-floor property that was purchased for INR 10 Cr in June 2021, as per real estate tracker Zapkey. Notably, Zapkey mentions the estimated cost of properties as per signed agreements.

The couple also owns a property in DLF Camellias in Gurugram’s Sector 42, sources alleged. This invite-only property is one of India’s most high-end residential townships, with apartments starting at INR 45 Cr and going up to INR 100 Cr, depending on the square-footage and floor height.

It’s unclear whether the Grovers purchased these properties with bank loans or upfront payments. But in a recent public appearance, Grover claimed that he indeed purchased a property worth INR 30 Cr, but it’s not clear which property he was referring to.

Either way, regulatory filings show that the former MD earned INR 60 Lakh in FY19, INR 86.8 Lakh in FY20, INR 1.35 Cr in FY21 and INR 1.7 Cr in FY22. In comparison, Madhuri received a remuneration of just over INR 60 Lakh from BharatPe in FY22.

Besides his salary, Ashneer saw INR 60 Cr in proceeds from a secondary share sale during BharatPe’s unicorn round announced in August 2021, according to sources. This was just a few months before Grover purchased the South Delhi property.

However, 30% of the proceeds from the secondary share sale went to BharatPe cofounder Bhavik Koladiya, as per our sources.

In all, Ashneer and Madhuri earned close to INR 70 Cr at most over the course of their employment at BharatPe, we were informed. It is not clear how much of these proceeds went into purchasing the high-end residential properties, not to mention the fleet of imported cars.

Interestingly, in March 2022, Ashneer sent media details of his and his wife’s advance income tax payments. While Ashneer paid over INR 7.1 Cr in advance tax, Madhuri is said to have paid INR 1.11 Cr in advance tax. But it’s not clear whether this was the full advance tax for the assessment year 2022-23, or just a portion of the tax owed to the exchequer.

More recently, Ashneer claimed that thanks to the performance of her startup investments, Madhuri paid INR 2.84 Cr in advance tax for AY 23-24. It’s not crystal clear how exactly she has earned close to INR 12 Cr (calculated from a 30% tax base) in the past two fiscal years to pay these taxes, or which of her investments had brought in the returns.

Hawking Tickets In The UAE

There’s another red flag when it comes to personal gains: In 2021, BharatPe signed up to be a sponsor for the ICC World T20 cricket tournament held in UAE in October-November 2021. This was a major coup for BharatPe, since it coincided with the launch of its BNPL product postpe.

The company heavily promoted postpe on TV and social media throughout the tournament in 2021. The BNPL product was Ashneer’s pet project, we were informed. We know that several employees from the company were also in the UAE for the tournament.

The sponsorship meant that the company was given free access to certain premium box seats for the entirety of the tournament. And the Grovers seem to have used this access to resell some of the box seats to other parties.

Sources alleged that Ashneer Grover was paid 750 AED for the passes for each match. The Grovers deposited this cash in their Emirates NBD bank account, alleged the sources we spoke to.

According to our sources, Ashneer and Madhuri collected close to INR 8 Lakh from individuals for selling these passes, though the amount could vary since most of this was done on cash.

Incidentally, it was in September 2021 that Ashneer and Madhuri received ‘Golden Card’ visas from the UAE, which are valid till September 2031. Inc42 has seen copies of these Golden Card visas.

Ashneer’s Many Flip-Flops

The UAE episode is pertinent because it is linked to the many contradictions in Grover’s claims since January 2022.

For instance, in January 2022, Ashneer alleged that Ex-CEO Suhail Sameer and General Counsel (GC) Sumeet Singh ran up huge bills during the T20 World Cup. This was just one of the many volte-face statements by the former MD in the last 16 months.

Grover had also alleged illegality in the involvement of Sameer and Sumeet in any potential investigation or committees set up by the board, as seen in his SIAC complaint.

In the case of Sameer, Grover had alleged improper behaviour and spending by the then CEO, while for Singh, the allegations ranged from ‘conflict of interest’ to deliberately increasing the legal costs of the company.

However, sources told us that internally, Grover had been all praise for Singh just a few months before the controversy erupted. One particular email, a copy of which was reviewed by Inc42, shows that Grover praised Singh’s work in the lawsuit over the ‘Pe’ suffix filed by PhonePe.

Ashneer even complimented Sameer on pulling off the Series E round in August 2021 which took BharatPe to the unicorn club.

Other internal documents — including an employee leaderboard labelled ‘Race To the IPO’ — showed that the GC was named the top performer for Q1 FY22, or April-June 2021. Singh was credited with bringing in a sponsorship deal for the Twenty20 Cricket World Cup and also delivering the in-principle approval for what would eventually become the Unity Small Finance Bank.

But under the spotlight of controversy, Ashneer changed his tack and alleged that Singh was responsible for dubious payments and the involvement of Shardul Amarchand Mangaldas — Singh’s previous employer — in the governance audit brought up a conflict of interest.

Singh did not respond to Inc42’s queries on this matter, but we know that SIAC dismissed these allegations in its emergency award.

Sameer and Singh were just two of the targets on Grovers’ radar. Others included Bhavik Koladiya, one of the original cofounders of the company, and of course, chairman of the board Rajnish Kumar. The ousted MD also trained his lens on Shashvat Nakrani — currently the only cofounder still at BharatPe — alleging that he was just a puppet of the board.

Misinformation Spree & The Real ‘Doglapan’

Through much of 2022, the battle between Grover and BharatPe was an information (or misinformation) war. Information about confidential board meetings and the contents of Ashneer’s emails to the board were reported in the media as a kind of ‘proof’ of lapses in due process.

One such instance was related to a two-hour-long annual general meeting (AGM) on December 31, 2022.

Reports about this meeting talked about an altercation between Grover and GC Singh. Ashneer alleged that Singh used threatening language after being questioned over his law licence. And if one hears just a part of the recording, it might even sound like one.

The interaction between Grover and Singh was also reported widely based on a ‘purported’ email sent by Grover to the board.

But the full two-hour recording of this AGM, which Inc42 has also reviewed, shows that Ashneer began throwing tantrums and disrupted the AGM with a stream of gibberish and howling.

Madhuri was also present at this meeting as a proxy (incidentally for another accused, her brother Shwetank Jain) along with representatives from Deloitte, cofounder Shashvat Nakrani, and Nalin Negi (CFO and interim CEO of the company).

Besides this, Inc42 has seen at least 23 emails from Ashneer Grover to the board between February 2022 and March 2023. Many of these emails have also found their way into journalists’ WhatsApp and email inboxes.

Ashneer relentlessly questioned the failure of BharatPe’s board to follow the due process in the investigation. But none of these emails from Grover ever contained any denials of the allegations being levelled.

Of course, the largest source of allegations is Ashneer’s infamous book ‘Doglapan’. Curiously, the book was released just a few days after BharatPe moved the Delhi High Court for a civil suit alleging a loss of INR 89 Cr and then filed a criminal complaint with the EOW for an alleged INR 81 Cr fraud.

Indeed many parts of Doglapan have attracted ire from veterans in the startup ecosystem. “If you have read the book, you would know that whatever he says, there was just no proof. It reads like a rant of a person who has lost the plot. How can anyone take this seriously?” a partner at an overseas VC firm that invested in BharatPe told Inc42.

Now, let’s come to the $3 Bn write off allegation by Grover in the wake of the EOW FIR. This is yet another flip-flop by Grover, who in January filed a perjury suit in the Delhi High Court against Nakrani. In the suit, Grover claimed his 4% stake is worth INR 900 Cr, which would result in a valuation of close to $3 Bn. Grover is not so quick to write off the company when it comes to his shares.

It’s Time For Better Role Models

Perhaps, Ashneer did not care how serious or legitimate his claims sounded in Doglapan or indeed in his selective media interactions.

He has time and again claimed that BharatPe is being run into the ground by chairman Rajnish Kumar and even mocked his involvement in a tweet on May 14, where he claimed he would be launching a ‘board game’ around the allegations of the INR 81 Cr fraud.

With a slew of public appearances in the past year and his no-holds-barred comments, Grover has amassed an army of followers on social media. Grover also spoke at a number of events hosted by reputed institutions such as IIT-Delhi and publications such as Times Of India.

Indeed, he’s being called a role model for young entrepreneurs and aspiring founders. Nearly every tweet — whether it is simply ridiculing BharatPe or self-proclaimed praise for his new venture and fashion style — gets hundreds of replies from ardent fans.

Many of these are aspiring entrepreneurs and claim that the Ashneer Grover way is the right way to build a company today. In other words, he’s being seen as a role model.

But does the Indian startup ecosystem need a ‘role model’ such as this, who has not only made some outlandish claims in his book, but one who is being accused of major financial crime?

Usually, those who are accused of fraud might deny it in a reasonable manner, but Grover has only mocked these allegations. And it resulted in BharatPe seeking an injunction against the former MD for using defamatory language in media comments.

Then there’s the near-viral YouTube video about his residence in Delhi’s Panchsheel Park, where he flaunted the lavish lifestyle that he so vehemently denied after being dismissed by BharatPe. That video has 7.2 Mn views at the time of publication.

The video shows off the Grovers’ collection of automobiles, with Ashneer claiming that only one car is actually in his name. We wonder who owns the other cars.

And despite this fleet of imported vehicles, Ashneer has not shied away from taking potshots at others such as Suhail Sameer who also own such cars.

One can only assume Ashneer simply lost track of what he’s claimed in the past. But a Brut video lays bare the very lavish lifestyle that Grover previously denied, but has since embraced. Here’s a more recent video where he talks about his wealth and how he spends it.

The Grovers have been featured by creators such as Bhuvan Bam and stand-up comics such as Kapil Sharma. And most recently, the husband-wife duo starred in a fashion photoshoot for FitLook Magazine — Ashneer and Madhuri were all-praise (for their style) on Instagram and Twitter.

There’s little doubt that the couple are on a PR damage control spree.

“Whatever you say about Ashneer, you cannot deny that he knows how to play the media game. Have you seen some of the photos that they (Ashneer and Madhuri) have put on Instagram recently?” the partner quoted above added.

Perhaps the image revamp and the PR spree was all for the new company that the Grovers launched in January 2023, one year after Grover last worked at BharatPe.

Third Unicorn Private Limited is more than a tongue-in-cheek reference to two unicorns where Grover supposedly played a key role. It’s seen as some form of redemption from the BharatPe controversy.

Of course, it’s worth noting that Ashneer barely contributed to the unicorn status of Grofers. The company entered the unicorn club in 2021, four years after Grover’s departure from the company.

As per Inc42’s funding data, Grofers did not raise any funds in 2017 when Grover exited the company, and its funding round in 2018 was a 20% downround at $300 Mn valuation. This was after the company had raised $120 Mn in 2015 at a valuation of $375 Mn. So, if anything, Grover’s involvement in the company resulted in a downround for Grofers.

So, Ashneer Grover can definitely not lay claim to that unicorn.

Third Unicorn’s valuation is currently unknown, just like its eventual fate given the FIR against Ashneer and Madhuri, its two directors.

Much Ado About ‘Third Unicorn’

BharatPe, of course, continues to be a unicorn today. Whether or not BharatPe will go through a valuation dip in the future cannot be predicted and talks about a write-off are just off-the-mark, say sources.

Those who have seen BharatPe’s FY23 numbers told Inc42 that the company’s revenue for the fiscal has grown nearly 2.5X since FY22. It is also likely to hit profitability in FY24, the sources said, based on how much the burn has been controlled.

Further, the company has received an NBFC licence, thanks to its majority stake acquisition in Trillion Loans in May 2023, which is another pivotal step in creating a full-stack lending play. This can only come after a check into the company’s financials.

To be fair, there are some challenges for BharatPe in terms of leadership with Suhail Sameer’s exit as the CEO. The company is yet to appoint a full-time CEO with Nalin Negi handling responsibilities as an interim CEO as well as the CFO of the company.

But in terms of business, we don’t know whether BharatPe has gone through a downturn in terms of revenue or profitability in the past year. One has to examine the company’s FY23 numbers to say this with any certainty.

Even if Grover’s claims of BharatPe being a write-off are sincere, in essence, he’s saying the business was not even stable enough to last one year without him. It’s not something anyone would want on their resume, let alone a CEO.

Given the EOW case and its potential consequences for Ashneer and Madhuri, there is definitely a lot more uncertainty for Third Unicorn.

Despite asking VCs to stay away, Third Unicorn raised funds from reputed business houses such as Haldiram’s, early-stage investor Venture Catalysts and celebrities. What exactly happens to this investment? The company is just a few months old, and such controversies have broken giants in the past.

Whatever the fate of the criminal investigation into the allegations against Madhuri Jain and Ashneer Grover, BharatPe did not emerge unscathed from the brush with Grover and his antics.

It’s definitely carrying some of the baggage of a controversial past year. Will Third Unicorn also pay the same price?

Note: We at Inc42 take our ethics very seriously. More information about it can be found here.