S’pore startup Zilingo avoids liquidation as board approves US$40M loan repayment to creditors

Three weeks after Zilingo fired its co-founder and CEO Ankiti Bose, the board has approved a loan repayment to creditors.

This repayment amounts to US$40 million (S$55 million), and has been authorised by its co-founder Dhruv Kapoor — who is also the company’s Chief Technology Officer — with immediate effect.

Over the past few weeks, Zilingo’s top management have been debating if the startup can continue running without Bose, with investors such as Sequoia Capital India and Koru proposing to liquidate the company.

Kapoor has fought to save the company, and in an email to shareholders of Zilingo, he stated that he did not believe that liquidation was necessary or meaningful for the company, its customers, note holders, and lenders.

Kapoor has also asked for their support, and stated that the company needs just US$6 million to US$8 million for the next year. He also revealed that Zilingo has been approached by companies that are interested in merging or acquiring Zilingo.

Is there still hope for Zilingo?

However, many Zilingo employees have been leaving the company, including its Chief Financial Officer and Head of Thailand.

Zilingo has also halted some operations in Indonesia, which was its biggest market.

The company provides e-commerce integrations for small fashion vendors across Southeast Asia, and was one of Singapore’s highest profile startups. Its investors included Temasek Holdings and Sequoia Capital India, among others.

In January, the company was negotiating a new funding round with Goldman Sachs at a valuation that would have made it a unicorn. However, a due diligence investigation into Zilingo revealed several financial irregularities, including how the company records transactions with merchants, and the fact that the company has not submitted an annual financial report since 2019.

Then-CEO Ankiti Bose was suspended in April, and she called the suspension a “witch hunt”, triggered by her complaints of harassment against an anonymous investor.

She was eventually fired in May, on grounds of insubordination, amongst other reasons, while the company reserved the right to pursue legal action.

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