Sequoia Capital—Multiple Sequoia Capital India portfolio companies caught in financial fraud and governance scandals
In 2022-2023, several Sequoia Capital India portfolio companies were embroiled in corporate governance scandals. BharatPe, where Sequoia held 19.6% shares as largest shareholder, faced allegations of financial irregularities. GoMechanic's founders were found to have committed fraud, leading Sequoia to write off its investment. Trell and Zillingo also faced governance issues. Sequoia publicly stated it would 'not tolerate any financial irregularity' and engaged Ernst & Young for audits. The pattern raised questions about Sequoia's portfolio oversight and due diligence practices in its India operations.
Scoring Impact
| Topic | Direction | Relevance | Contribution |
|---|---|---|---|
| Corporate Governance | -against | primary | -1.00 |
| Overall incident score = | -0.429 | ||
Score = avg(topic contributions) × significance (high ×1.5) × confidence (0.57)× agency (negligent ×0.5)
Evidence (1 signal)
Sequoia Capital India portfolio companies BharatPe, GoMechanic, Trell, and Zillingo faced fraud and governance scandals
Multiple Sequoia Capital India portfolio companies faced corporate governance issues in 2022-2023. Sequoia was the largest shareholder in BharatPe (19.6%) which faced financial irregularity allegations. Sequoia wrote off its investment in GoMechanic after founder fraud was discovered, and engaged Ernst & Young for audits. The firm publicly stated it would not tolerate financial irregularities.