Eduwizards had raised Rs. 20 Crores from Dalmia, of which over 10 Crores was due from the investors.
Eduwizards Investors Dalmia Bharat family has now pulled out without fulfilling commitment.
Eduwizards founder, Ashish Sirohi has shared the email that he has forwarded to the team and below are the key excerpts*.
Chance of very high returns has propelled India's business families into internet investing but some, like Dalmia Bharat family, want to have returns without the high spend and the high risk.
Based on this hidden strategy, Dalmia family have been playing a game with Eduwizards, with no intention of giving Eduwizards 20 Crore, and have now backed out after giving less than half of the 20 Crores we had raised from them.
They have repeatedly refused to spend and then pulled out completely when could not flip their investment to a Venture Capital firm because of current funding crunch conditions.
In fact no money has come from them since early July 2016 and the pressure from them has been to sell Eduwizards at any price and get the Dalmias immediate exit. We have survived on earnings in our USA bank account.
The Bigger Cause – Warning India’s Entrepreneurs about such Indian business families
If Indian industry and businesses are corrupt and technologically-backward it is, I believe, largely due to these traditional powerful families and the control and government-nexus they have established over India. Everyone in India is terrified of challenging these big name families, no matter what wrong they might do. Now these families want to bring their traditional manipulative century-old family methodologies to the India's internet world so that it resembles their family business styles.
And Indian internet is adopting a style parallel to India’s brick-and-mortar industries – India’s internet companies are also mostly lagging in genuine cutting-edge tech when compared to American and Chinese companies who are in the same internet business. Indian century-old families have arrived to level out Indian internet and bring it under their business influence!
Indian investor circuits now have professional internet investors joining such traditional century-old business families in a big social network. There seems to be a nod of deference that these families will now also become part of internet investing no matter what their methodology or behavior, and everyone has to accept the their power, because bowing before these family names is the Indian way.
On the other hand, I do not want to club all Indian business families as bad for India. We all do admire many such as the Tatas whose ethics and integrity are exemplary.
Indian business houses did invest in coolness of PR/startups, but the reality (slow to no returns) has hit them now ?
- Disclosure : These are excerpts from emails sent by Ashish Sirohi to us.