???? Governance clean-up

The issue of corporate governance at Indian startups reached a critical point in 2022 following convulsions at Zilingo, Trell and BharatPe. The list continued to grow in the new year, with GoMechanic, Rahul Yadav’s Broker Network (backed by Info Edge) and Mojocare all falling woefully short of expected standards.

The biggest shocks, undoubtedly, originated from Byju’s, India’s most valued startup. Disagreements between founders and investors over financial audits and governance have pushed the edtech into near bankruptcy.?

Byju’s will remain in the spotlight in 2024, as will BharatPe and Broker Network, which are in the middle of court hearings. However, there is a growing sentiment in the startup ecosystem that the tide is turning.

“Investors have been able to identify governance issues within their portfolios. They have even initiated forensic audits in companies where lapses were suspected,” stated a VC. “While there may still be surprises or isolated cases, the intensity of challenges is expected to subside compared to the past 24 months.”

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Accel, Elevation poised for profits on BookMyShow bet?

Arc Notes

• Private equity firms and growth-tech funds may acquire a sizable stake in BookMyShow, an app for movie and event tickets. Three people aware of the talks say early investors like VC houses Accel and Elevation, which collectively hold 25%, will partly sell their shares.??
• BookMyShow expects a valuation of more than $1 billion, but the eventual figure will depend on the bids, the sources add. This will represent a handsome 50% premium compared to its last valuation of $675 million, attained during a funding round from TPG Growth in 2018.?
• A price appreciation will be another important note in the company’s recovery story. After seeing its business being decimated by pandemic-induced lockdowns, it has logged robust revenues and turned profitable. It is unlikely to raise primary capital in the deal.?

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