Mojocare investors discover financial irregularities as startup fires 80% staff
The development comes a day after the healthtech startup laid off more than 80% of its employees within a year after raising $20.6 million in a Series A funding round.
Investors of—a Bengaluru-based healthtech startup—have found financial irregularities in the company and are looking at scaling down its operations, they said in a statement. Mojocare is backed by Peak XV, B Capital, and Chiratae Ventures.
“Major investors of Mojocare initiated a review of the company’s financial statements. While the analysis remains ongoing, initial findings have uncovered financial irregularities, and it has become apparent that the business model is not sustainable due to a variety of operational and market factors. As a result, Mojocare will be scaling down operations, and the investor group is working with the company through its transition,” they said in a joint statement.
Mojocare denied accusations of money being taken out of the company. It told YourStory that it is working "closely" with the investors.
The development comes a day after Entrackr reported that the healthtech startup laid off more than 80% of its employees within a year after raising $20.6 million in a Series A funding round.
“More than 200 employees are expected to be impacted by the decision,” Entrackr reported citing sources.
Attributing its decision to laying off staff to difficult market conditions, Mojocare said it will revert to operating with a small team to improve unit economics.
"Our business fundamentals have not worked out over the past few months. In order to become more capital efficient, we have decided to rationalise costs," Mojocare said in a statement.
According to the report, the affected employees had their email and Slack IDs disabled abruptly, without any prior notice. The company confirmed to Entrackr that it has let go of a substantial number of employees, emphasizing its need to rationalise costs and prioritise profitability and sustainability.
YourStory has not been able to confirm this independently.
Mojocare was co-founded by Rajat Gupta and Ashwin Swaminathan. The startup aims to provide personalised wellness products and services, including consultations and treatments for various aspects of daily health, including nutrition, fitness, hair, skin, sleep, and sexual health.
Backed by prominent investors, Mojocare has raised a total of $24 million in funding and was valued at around $70-75 million during its last round.
(The copy was updated with a company statement.)
Edited by Suman Singh