'Intimidation is just unhealthy': Start-ups rally behind Stayzilla founder

Vendor who complained says small businesses suffer due to start-up founders extravagance

India’s start-up leaders, including Flipkart founder Sachin Bansal, rallied behind Yogendra Vasupal, the founder of Stayzilla who was arrested by the Chennai police on charges of fraud, seeking intervention of Prime Minister Narendra Modi and local leaders in both Karnataka and Tamil Nadu.

Snapdeal founder Kunal Bahl, who has been under attack by vendors over delayed payments, says he was also a victim of people with bad intentions “Many startup founders, including myself, have seen the ugliness of getting on the wrong side of people with bad intentions,” Bahl wrote on microblogging platform Twitter.

The All India Online Vendors’ Association (AIOVA) has complained that Snapdeal owes vendors dues for over eight months and is in talks to resolve the issue.

"We stand together with entrepreneurs, startup India needs your support," Flipkart founder Sachin Bansal wrote on Twitter, appealing to Modi. "Let the law take its course, but intimidation of Stayzilla founders crosses a line. It's unhealthy for entrepreneurship in India."

Bansal was joined by Snapdeal founder Kunal Bahl, InMobi founder Naveen Tewari and Ravi Gururaj, the head of Nasscom's product council, on the platform to support Stayzilla.

"Entrepreneurship is the future of our country; let us save entrepreneurs, they will save India," wrote Tewari in his Twitter handle. CS Aditya, the founder of Jigsaw Solutions, the firm that filed the police complaint against Vasupal, maintained that Stayzilla cheated his company of Rs 1.72 crore to run campaigns to attract users for the marketplace for alternate accommodation. He also claimed to have proof of the founders siphoning money from Stayzilla to their personal accounts.

"How long will advertising agencies and media houses bear losses because of irresponsible wannabe entrepreneurs who manage to get funding just to live a five-star life for a few years and then finally shut shop and expect hardworking business people to suffer?" wrote Aditya in an email sent to this newspaper.

The matter escalated after Vasupal put up a blog post that had voice recordings of Aditya, who abused him over delayed payments, and a video recording of the landlord of its Bengaluru office abusing him.

Karnataka's IT Minister Priyank Kharge had earlier sought help from his counterpart in Tamil Nadu to intervene in the issue. Vasupal, who shut his business last month, was arrested on Tuesday. His bail application is to be heard on Thursday.

The Chennai chapters of TiE and Nasscom called it terrorism that would affect the startup culture in the city.

"Freshdesk and Stayzilla are icons. A lot of young people want to begin such startups and they look up to people like this," said P Narayanan, president, TiE Chennai.

"This reflects poorly on the law and order situation in the state. The case is a civil case and it is a matter of payment not having been made to vendors," he said.

K Purushothaman, regional director of Nasscom, warned that Tamil Nadu's startup ecosystem would be affected by this development.

"This will dent the startup ecosystem in the state. The way newspapers and social media are reporting it, it looks like a clear case of harassment," he said.