Bose, co-founder of the Sequoia-backed fashion B2B commerce firm, maintains that the board kept her in the dark on the complaints against her and the investigation report. “I was a kid for most of these people when I started working with them. It’s shocking to me that they won’t tell me what’s going on,” she says in an exhaustive interview.
Ankiti Bose was visibly calm. She smiled throughout the interview, but there was a sense of chaos and disbelief in her words. Her voice choked just once when she spoke about the online threat to her family, but she quickly regained the lost smile on her face. She was terminated by the board of Zilingo just a few hours before ET Prime spoke to her.
Bose put up a brave face and weighed her words in the 90-minute chat, in which she said personal fallouts led to the current crisis at Zilingo. She insisted that she was not shown any investigation report or complaint against her. She still maintains a slender hope of reconciliation, of leading the efforts to resolve the debt issues, and take the company forward. Bose shared her side on many questions around the affairs at Zilingo that have been in the media for the past several weeks. Edited excerpts:
Q. Your termination letter alleges insubordination. What insubordination are they referring to? Does it also mention any financial misdoings?
Let me first start by saying that I’m very shocked, because just this week, I actually thought we were having constructive conversation. I had offered my time for next week, as well. As I understood, the investigation was going on, and eventually a report would be provided. So I’m a little surprised at the moment with everything that is going on.
And yes, the letter states that I am terminated for insubordination.
Among other things, what caught my eye the most is that everybody knows how I have been attacked in the media and social media. There were threats to my family, to me. Pictures of my mother have been used to threaten me. I was actually rehoming my family this week.
After 10pm on the 18th, I was asked to come in the next day. I couldn’t do that because I had asked them for some time. I have mentioned to several shareholders again and again that I’m under a lot of pressure. And since I didn’t show up, I was terminated.
Till this point, I have not seen the original complaints or any report. If a report comes out now, it’s probably vitiated. I don’t know who made it, how it was made. I just want to think about what this means for the company as well. Because at the end of the day, I started the company when I was 23. This has been my whole life. I really don’t know what I’m feeling right now.
Q. No mention of financial irregularities?
They have referred to allegations that were shared with me, they have not shown me any report of financial irregularities.
Q. How do you plan to contest it?
So far, I have just been asking various shareholders, board members for due process. On March 31, the day that I was supposedly suspended, I attended a meeting that was with an investigator. At that point of time, I did not know that this investigator had not been duly authorised by the company. So I have flagged breaches like that — of process — again and again. I have been told by the board that the process was, in fact, followed. But I have not received clear guidance on what that was. So, I’m still trying to find out the answers to some of these questions. So, it remains to be seen how this will move forward.
Q. Do you plan to file a lawsuit?
I cannot comment on that yet.
Q. While the trigger for your suspension was said to be discovery of some discrepancy in the accounting practice, it is quite well known that there were intense conflicts within the company and at the board level. What led to this situation?
Covid was a tough time for us. We all made the decisions that we thought were right for the company. There have been several relationships that have frayed, which have led to this. These things don’t happen overnight. These things also do not usually happen if the issues are as logical and clinical. They usually come from deep-seated interpersonal issues, a lot of rage and anger.
Q. What were those interpersonal issues?
We certainly had issues in the team. I have always tried my best to not let it boil over and hurt the company. When I reflect now, one of the things that we could have done better was how we managed Covid. Events around 2020 led to a lot of these things. But the truth is that I was 23 when I started the company. This has been my whole life, and to have it all taken away is extremely hurtful.
Q. Many e-commerce companies have grown during the time of Covid. But you were in trouble for the most part. Why?
Fashion as an industry was badly affected for sure. We are in the B2B business, which means that merchants were holding on to too much fashion inventory when Covid happened. Retail businesses that would work with us were badly affected. It has taken a long time for them to recover. We tried everything to keep the company together. Between 2019 and 2020, we cut down burn significantly. And I hope that the business can still do well in the future.
Q. How did you cut down costs? Can you take us through those numbers?
So the burn in 2019 was quite high, because we were growing quite fast. We were giving a lot of incentives. I don’t think I’m in a position to share that data. But what I would say is that there was a reduction of more than 70% between pre-Covid and Covid. It was driven by rationalisation of operations, and layoffs, as well as cutting back on marketing and sales incentives, which was such a big part of this entire conversation.
Q. So it was in the middle of the pandemic-induced challenges you were asked to step aside by one of the investors?
Sorry, I cannot comment on that.
Q. Sometimes startups outgrow founders. A different set of skills may be required at a certain stage in the life of a company. During such times, don’t you think that it is probably a wise thing to move on and take a broader role?
Look, there’s no point in regrets. I thought about it many times. In fact, even during this entire process, I’ve had that discussion with several investors. But it seemed like that was not something that certain individuals had in mind. I had reached out and tried to be reconciliatory in the interests of the company several times.
I am actually still thinking that there will be some shareholders who will look at this entire thing and would want to do more to help the company, and I don’t know how things will play out actually at this point.
Q. Board members and key executives including a co-founder and COO are united against you. How is it that you are on one side and others are on the opposite side?
Your question sort of answers it. When one or two individuals are guiding multiple parties, and they are the ones that are in charge of stating the facts to them [this happens]. I have been suspended for 51 days. I have not been able to talk to anybody for 51 days, and present my views. I have not even been able to react to a report. In any fair process, I think everybody should hear all sides. I don’t think that I have been sufficiently heard.
There were certain elements and dynamics in the boardroom over the last two or three months that might have exacerbated this situation. People have had a lot of fun almost at our expense. Talking about us in the media, social media.
When personal relationships fail and trust breaks, really bad things can happen. I am still trying to get to the bottom of all this myself.
Q. If it is one investor having individual issues, why should others string along? They have so much at stake here.
All facts are not transparently on the table, which is a critical piece of any kind of due process or natural justice. That’s what’s important right now. I’m obviously just collecting myself and figuring out why when I was setting up conversations for next week, this has happened. I was actually quite excited that I’ll get to share more and understand more about what was going on. I have definitely let my protests known to the board this week. I’m still trying to wrap my head around it. I’m trying to be strong.
Q. For the past two years, you did not file your audited finance. The audit is still going on. It has been interpreted as there is some mess, some problem, that’s why it is delayed. What is your response to that?
In 2020, when everything was restructured in the company, there were definitely issues that we faced primarily because of Covid. And all of those problems were flagged to me and the investors. People have tried to resolve them. The finance team stepped in, but everything doesn’t get resolved in one day. So it’s been a two-year effort.
Q. What exactly were the issues that were flagged?
Now that falls into the category of confidential information I can’t speak about, because I’m no longer the CEO.
Q. CFO James Perry left the organisation in barely 1.3 years of joining. According to our sources, he left because he wasn’t convinced about the way businesses were done at Zilingo. What is your comment?
I can’t speak on his intentions or motivations at all. They [the board] have told me specifically, I can’t share this anymore. This was a part of the documents that I submitted in the probe.
Q. But his exit has been projected to show there was something wrong in the system.
I don’t think that’s true. That is my view. There were several operational challenges during Covid. I think a lot of people just shrug their responsibilities. I’m not saying who, but I was not one of them. I stuck around, making sure that things carried on and the lights were on.
Q. Zilingo raised around USD38 million in debt in 2021. What was the situation that led the company to raise the debt in the first place? You had raised USD226 million just in 2019 in equity funding.
It was a good decision at the time Covid was happening. It was a good way to get lots of liquidity into the company, make sure that the company was well financed. And now what I learn from the media reports is that the company has to pay off the debt in an accelerated fashion, which would mean that the company would have to raise money to do that.
I have heard from two shareholders who came to me very concerned that the reason that they [the board] are in a rush to terminate you is that the financial advisors will not back the company unless there’s a clear decision on the leader. Now that this matter had begun, it needed to be concluded. It had been two months.
I have asked the board this question as well, but I have not heard back.
Q. Some reports suggested Zilingo has enough cash — a runway of 18 months. But the company is not in a position to handle a debt of USD40 million.
I believe the runway included the debt amount, had a special event like the acceleration not taken place. Now that it has, the company has to raise money to ensure that the creditors are paid at the accelerated schedule.
Q. Zilingo’s marketing and advertising cost exceeded your revenue. Does that mean your revenue was entirely propped up by discounts and incentives?
E-commerce companies spend so much money on marketing and so did we. And when Covid hit, it was the first time we realised that this was the time to clamp down on marketing, advertising, and incentives. Because this was going to be a tough time. And it will be hard for businesses that are completely subsisting on incentives to actually survive. So we cut back on that. That was a really tough part of the job.
Q. Who took the decisions on cutting down jobs — you or the investors? Do you think the hate e-mails, including sexually explicit messages, started pouring into your inbox only after you initiated the layoffs?
The layoffs and everything around it were always a group decision. It was never a one person’s decision. It was a tough time. And I wish we never had to do it. But at the same time, we made the decisions that we thought were best at that point of time. And to answer your question, just purely from a factual and timeline perspective, all of the harassment, everything started in 2020. In fact, mid to second half of 2020 is when it really picked up. The causality and correlation, I don’t know. But the fact is that it did start after these actions were taken.
Q. So given the fact that it was a group decision, did the company and investors stand up for you then?
I brought it up to some individuals, and definitely, people in the team. It has always come down to you needing someone to blame. It was a tough time for people. You were at the receiving end of those decisions. And I think it was easy for people to target me and send me those harassing e-mails. The toxicity was very extreme. I have never shied away from saying just how hard that was for me as well.
Having said that, did I hope or expect that other people would support me more? Definitely.
It’s incredibly hard for a 28-year-old to, firstly, be driving the decision to lay so many people off and, secondly, deal with the consequences of the constant barrage of harassment that came afterwards. [Plus] Managing the frayed interpersonal relationships in your leadership, while making sure that the business is okay. People were actually getting Covid. So a lot of people were sick, it was a very, very tough time. We had a death in our team.
Q. There are two versions about the fundraising talks. One is the company had an active term sheet for USD200 million funding at USD1.2 billion valuation. The other is the financial discrepancies were discovered at the time of due diligence as part of this funding round.
To my knowledge, that was not the case. No new investor who was interested in investing had told me that there was any discrepancy. In fact, after my suspension, while people kept asking me to go on leave, all sorts of pressure was building up. I was not able to contact these external investors, but they didn’t know what was happening because it was not in the media yet, and they were reaching out to me. So, to the best of my knowledge, this discrepancy, or the problems with revenue, or any of these other matters, were not brought up during diligence by another investor. If it happened after my suspension, or [was conveyed] to someone else, I don’t know.
Q. You just mentioned you were asked to go on leave after getting suspended. Who asked that? Why was that done?
The board members asked me to go on leave. I am still not certain why.
Q. After how many days of suspension?
On day four and day five [after suspension], they said, you go on leave. Later a different shareholder told me that it was to avoid the kind of situation that we’re in today. But it was never told to me that way. So, I really did not know. I was not keeping well. I was very unwell on the day I was being told to go on leave. So actually, I did not see the messages. I’ve been battling some health problems of late. So, it just happened to be at a time and date when I was at the hospital.
Q. So you decided not to go on leave?
Look, my stand was that if I’m to be suspended, then suspend, right? If you want to fire me, fire me, but I am not going to go on leave. I need to understand what this is about.
Q. A number of times it has come up in the media that you were trying to mobilise funds to repay this debt, or trying to buy out the investors, and you want to take the company forward. But how realistic is that? It’s a confrontational environment. Could you actually proceed? Also, how easy is it to raise capital from the market when you are in such a situation?
I’m considering whatever can help the company, and that’s why I considered this option and we’re still looking at it. You are right, the environment is very confrontational right now. As recently as Wednesday, I had offered to speak with the board and have a discussion with them, but they went ahead and terminated me instead.
They have taken 45-50 days for their analysis, and they barely gave me any time to come back to them. So, you’re right the atmosphere is confrontational. I guess that makes it hard to have any deliberations. But I’m still hoping that in the interest of reconciliation, in the interest of being constructive, we can work something out together.
Q. What’s your prospect of mobilising that kind of money during this time?
If it happens, when it happens, we will see.
Q. But are you saying you have people willing to back you to initiate such a move?
We are considering several options. But like you said, it’s a confrontational environment with the company at the moment. So I don’t think I can comment any more than that.
Q. Despite your termination, are you optimistic that there could be a middle path that can help you and the board come out of this situation?
From March 31, on April 12, on April 8, on April 15, on May 17, and as recently as this week I have reached out to the board members and said, how are we going to do what’s right, how are we going to do what’s good for the company? Can I see the original complaint? Can you tell me what’s going on?
I was a kid for most of these people when I started working with them. It’s shocking to me that they won’t tell me, and I’m trying to figure it out.
I don’t know why we are not taking a more reconciliatory approach towards doing what’s right. But at the same time, I understand that there are other elements at play here.
Q. The company was on path to get another round of funding. At such a time, why would any investor which has more stake than you in the company want to jeopardise this opportunity?
I’ll ask you a simple question. Why am I fighting so many big people? Because this is my life. This is my reputation. They have hundreds of companies. They have so many investments. A founder did something to upset you or not, there’s action or not — it’s all part of life. But for me, this is everything. So, I have no choice but to at least find answers to what has happened here. I am as perplexed as you are.
All the issues, the struggles at Zilingo — none of them is a secret. We’ve always been open about them. All the problems we’ve had, we’ve always taken an approach of fixing them. I have heard from the market … how did it come to be? Why did the shareholders allow only two or three board members to lead the matter? I don’t know. Why was I not given time after being called on May 17, after asking for more time — when I’m rehoming my family from threats, being called in at 10pm to appear in a few hours within less than 24 hours, and then not going being used as insubordination to fire me? People are telling me different things, shareholders and journalists are telling me that it’s because they were under pressure to terminate you.
Q. The company has said it hired a consulting firm to look into the harassment claims filed by you, and added that the investigation has concluded that the company took appropriate action and followed due process to address these complaints.
If they have addressed my concerns, I have not been told because just like the Kroll report, I have not seen it either. If I’m the complainant of the harassment, I should be informed or at least asked if I feel like I have been adequately taken care of or my concerns have been addressed. I have not heard anything.
Q. The company had forecasted that its net revenue would rise from about USD40 million in fiscal 2021 to roughly USD60 million in fiscal 2022, and USD100 million the year after, according to presentation documents reviewed by Bloomberg News. Zilingo said it anticipated breaking even on core Ebitda in fiscal 2023 and then reach almost USD200 million in fiscal 2026. How accurate are these projections in the light of new revelations coming out?
We never claimed things were hunky dory. I have on record said that a huge part of our revenue fell during Covid, we had to restructure a lot of the team. We have needed and taken help from our investors and external advisors.
In terms of growth projections, these projections were made mid-year FY22, which is in calendar year 2021, which means that for this year, whether they were met or not, or for next year, whether they will be met or not, it’s a matter of a lot of factors, like funding, the overall environment, the focus on profitability, and so on. While obviously, the numbers have been met in the past, whether the numbers will be met in the future depends on what’s going on at Zilingo. If on March 31, you would have asked me, I would have said that the company has a good shot, assuming it can raise the capital, rehire the people that it needs. Right now, I don’t have visibility.
Q. But did you meet the USD60 million projection of FY22?
We did not meet that projection to the best of my knowledge. But again, I have been suspended and then eventually terminated before I had access to the closed audit.
Q. Did you fall short by a wide margin?
I would not want to comment.
Q. When you were raising money, how many funds approached you and why did you choose Sequoia?
I have no comments.
Q. Till about three years ago, your firm was something formidable. Did you ever think it would come to this?
Never. Two or three years ago, of course, we were formidable and through Covid, we were resilient. Even on March 31, when I knew that we’ve had several problems and interpersonal issues, I absolutely did not see this coming. Even this morning, when I woke up, I genuinely thought that on Monday, I’m going to have conversations and get an understanding of the report, and so on.
Q. Why did you start Zilingo? What was the thought process? What problem were you trying to solve?
I was in Bangkok, and these merchants just had no tech, and I loved the idea of providing tech to them. I think those were my best days.
Q. Do you plan to build something afresh? You have already done that at such a young age.
Absolutely, but right now I need to understand what happened. This is my first baby. Anybody who knows me knows that I was absolutely obsessed with my work and the company. Whether it came to putting my personal life second, or my health second, I have made huge personal sacrifices … I have read reports about my fertility, mental health, and personal life, and they are not inaccurate.
I have seen similar situations play out a lot, obviously, but many of them are not like this.
Q. Are you convinced that this happened purely due to financial irregularities, or it happened because of ruptured interpersonal relationships?
It’s a complete rupturing of interpersonal relationships.
Q. You were terminated after 51 days of suspension. What have you been communicated? Have you got a complaint letter? Do you know the allegations?
Have I seen the original complaint? Absolutely not. Have I seen a redacted version of the original complaint? No. Have I seen the report that has been apparently used to terminate me? Absolutely not. Have I, therefore, been given a chance to respond to that report? No.
I have been speaking with experts, people who have worked at Big Four firms here in Singapore. The common practice is that once a report is created as a part of an investigation, when there’s a whistleblower complaint, the person whom the whistleblower complaint is against actually gets a chance to reply to the report. They can often do it in writing, and it is actually included in the report. That is circulated to all shareholders and stakeholders, so that a proper view is made of the situation. Several processes take place before such a termination.
Q. According to our sources, investors wanted Zilingo to turn profitable while the company was still struggling at the unit-economics level. If you were running Zilingo right now, how many more months would you need to turn profitable?
Nine to 10 months — that was the plan which was prepared and presented