Wellness start-up Mojocare’s board is due to meet later this month, as the final audit report has been submitted by Deloitte, according to sources. The start-up has been on the radar over issues with corporate governance.
The founders had overstated revenues and sales in internal presentations to investors, and also showed raised expenses (to explain losses despite larger revenues), according to sources who were informed on the contents of the final forensic study.
Investors raised concerns recently about the company’s financial records. “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,” they noted in a statement.
As a result, Mojocare will be scaling down operations, and the investor group is working with the company through its transition, investors further said. Previously, Mojocare also laid off 80 per cent of its workforce and the layoff had affected over 200 employees, according to reports.
According to reports, the board is currently considering shutting down operations. However, the final audit found no evidence of founders siphoning money for their own gain.
Mojocare has so far raised around $24 million, and is backed by Chiratae Ventures, B Capital, Sequoia India’s Surge, and Better Capital. Founded by Ashwin Swaminathan and Rajat Gupta in 2021, the start-up provides personalised and full-stack solutions across sexual wellness, haircare, weight management, mental health, and women’s wellness.