Accused of shady payments, ex-CEO of S’pore startup Zilingo responds with a US$100M lawsuit

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After years of making headlines for all the right reasons, admired as a young, successful startup founder, Ankiti Bose, Zilingo’s former CEO is now receiving less favourable coverage.

Having been suspended by her investors (which included Temasek Holdings, among others) last April over controversy about her behaviour and managerial decisions, she is still trying to clear her name.

After all, at just 30 years of age, having been tainted with a failure of such significance makes future career very difficult.

Now, after being a target of another round of speculation about payments made by the company, amounting to at least US$10 million in total, she decided to fire back with a defamation lawsuit.

But does she have a case?

There is such a thing as bad publicity

The old adage is that any attention received is fundamentally good, but it’s quite clear now that it’s not always the case. When you ride high in the saddle and your company is on the front pages, you’re putting yourself at enormous risk.

Even if you had good intentions but ended up making disastrous mistakes, your career may have no future after such a spectacular downfall.

After all, it’s difficult to expect future investors — or future employers — would be interested in working with someone accused both of abusive behaviour as well as mismanagement of the business, that ended up threatening its very existence.

In other words, Bose is fighting for her life.

And it’s not easy when you’re publicly accused of taking a cut of millions of dollars paid to a law firm, as an Indian investor Mahesh Murthy, co-founder of Seedfund, alluded last month in an article titled “From Vulture Capital to Victim Capital”, taking a dig at various founders whose questionable behaviour, he argued, led to decline in funding on the local startup scene.

One lady ran a popular fashion portal and took Sequoia’s money. She got her firm to pay her lawyer [US$8.5 million] as fees and it is rumoured she got a lot of that amount directly back to herself as cut. She also got her firm to pay a public relations agency [US$1.2 million] a year to have her profile appear as a glamorous CEO.

– Mahesh Murthy for the Outside Magazine, 1 March 2023

While no names were mentioned, it’s quite clear who this opinion alluded to, which is why Bose has responded with a massive US$100 million defamation lawsuit submitted to the Bombay High Court against Murthy.

“Ms Bose said that the US$100 million was computed by calculating, among other things, her balance of equity in Zilingo and taking into account “the losses that statements like this can affect future endeavours.”

Meanwhile, she called the piece a “litany of lies, distortions, and venomous claims”.

“Mr Murthy’s piece is a continuation of the three-year-long vendetta against me. This malicious media campaign launched against me has harmed my reputation, caused significant financial losses, and is entirely based on fiction, with not a shred of evidence against me,” the former Zilingo CEO said in a statement. 

Diversion before the storm?

This controversy could not have erupted at a better time for Zilingo’s embattled ex-CEO.

Being publicly smeared — and so far baselessly, as no facts on the matter have been revealed — only helps her reinforce the image of a scapegoated female founder in a toxic world of male investors (as she often suggested in her defence).

That said, she was, thus far, not permitted to receive the results of an internal audit conducted by Deloitte and Kroll. This may indicate that there could be a future legal action pending on behalf of the shareholders against Bose.

Should the audit reveal her guilt, her own lawsuit may very quickly backfire.

According to an investigation conducted by Inc42, at least US$10 million were disbursed with her approval in dubious circumstances — including the aforementioned US$8.5 million (or even over US$9 million) to a law firm Algo Legal, among other payments, including for services that were not contracted until months after.

“For instance, the US$944,000 paid to EbixCash was said to be for the development of a ‘parallel IT system’, despite Zilingo having an in-house tech and product team.

The contract for the EbixCash deal was signed in September 2021, but the official documentation has been backdated to April 2021. Zilingo paid EbixCash close to US$630,000. Essentially, Bose had approved payments to a vendor even without an existing contract.

When it comes to OneDelta, the situation is even murkier. OneDelta was paid a total of US$2.3 million for testing, quality control and maintenance of the so-called parallel technology platforms. However, OneDelta was being paid well before EbixCash even appeared on the books of Zilingo.

As per sources who have seen emails between Bose and these vendors, the Zilingo finance team was allegedly told to process these payments by Bose.”

– Zilingo’s Collapse: Inside Ankiti Bose’s Multimillion-Dollar Implosion

If these allegations are proven to be true, it would mean that not only the pending defamation suit, but months of PR battles in the media, were nothing else but damage control in an attempt to salvage whatever is left of Bose’s image as a successful female startup founder.

And it now hinges on the findings of the audit conducted on behalf of her investors. Will they give her an out?

Featured Image Credit: Mint