Recently many startups have flopped in the stock market.Image Credit source: Freepik
Gone are the days of startup founders basking in the cash of venture capitalists. Recently, there have been cases of many startups flopping in the stock market, keeping high valuations despite huge losses, founders doing financial manipulation in the companies. That’s why now there is a plan to follow strictness like corporate governance in startup companies. Know what is going to change in the world of startups…
In fact, many venture capitalists who are funding startups have been advised by consulting firms to get the companies included in their portfolio audited once. Regarding which there seems to be a consensus among the venture capitalists. Recently, many audit companies have also given their presentations regarding this to the venture capitalists.
Mistakes come to the fore in the audit
Complaints of financial irregularities in Indian startups have become common now. First, the case of Ashneer Grover and his wife Madhuri Jain came to the fore in Bharat Pe. After that, even after ‘MamaEarth’ withdrew from the IPO, the news of irregularities in financial accounts and over valuation came to the fore. According to a Mint news, out of 100 unicorns present in the country, only 25 are in a position to earn profit. Earlier startup companies like Paytm, Zomato and Nykaa listed in the stock market have failed to return even the original money of their investors.