In a sudden turn of events that’s causing waves in India’s startup hub, Medikabazaar, an online B2B medical supply chain platform, has removed its co-founder and erstwhile CEO, Vivek Tiwari, amidst serious allegations of financial fraud and corporate malfeasance.
Why Vivek Tiwari Was Removed From Medikabazaar
According to regulatory filings available through the Registrar of Companies (RoC), Medikabazaar shareholders voted out Vivek Tiwari as a director by passing a resolution. The move follows an in-house probe, which revealed “malicious and fraudulent activities” that resulted in “irreparable harm and damage” to the company.
The probe was carried out by Alvarez & Marsal, Uniqus India, and law firm M/s Rashmikant & Partners. Tiwari violated his fiduciary responsibilities and was charged with gross negligence, misappropriation of funds, and tampering with financial statements.
PwC Findings Prompted Vivek Tiwari’s Resignation as CEO
As per audit company PwC, Vivek Tiwari’s ouster as CEO a year ago was prompted by major revenue recognition discrepancies and pervasive governance concerns. These warning signs led to a closer look that eventually resulted in his ouster from the board altogether.
Vivek Tiwari Replies to Charges
In an email statement sent to Entrackr on April 18, Vivek Tiwari refuted all charges made against him. He stated:
“I unequivocally deny all charges of fraudulent behavior or willful misrepresentation during my time as CEO. The allegations made indicating my involvement in any so-called inflation of revenue numbers are inaccurate and don’t represent the facts of the matter. I am still sure of the truth. In the days ahead, real facts will come out, shedding light and upholding my personal reputation and integrity.”
Medikabazaar’s Financial Standing and Investor Fallout
Established to rationalize India’s disintegrated medical procurement system, Medikabazaar has raised more than $190 million in capital. A 2022 $65 million Series D round—led by Lighthouse India—valued the firm at $700 million. Key shareholders include Craegis, Rebright Partners, and HealthQuad, with co-founders Vivek Tiwari and Ketan Malkan each holding more than 12% equity.
Yet, in spite of this robust investor support, the firm has been under increasing financial pressure. Medikabazaar for FY23 reported ₹908 crore of revenue but a net loss of ₹304 crore. Importantly, its Series C investors have raised an indemnity claim of ₹278.7 crore on grounds of misreporting in previous accounting periods. The annual report of the company for FY24 has not been filed yet.
What This Means for India’s Startup Ecosystem
The case at Medikabazaar is a reflection of similar issues witnessed in other startups, even listed companies such as Gensol Engineering, where promoter-led financial manipulation has eroded investor confidence. Every such case puts more pressure on honest founders since venture capitalists and stakeholders have to implement tighter controls and governance structures.
The sad fallout is a startup ecosystem where suspicion is spreading more quickly than innovation. These scandals also uncover a profound crisis of corporate ethics, particularly in high-growth cultures that tend to draw the line in the wrong places between ambition and accountability.
The Bigger Picture: Ethics and Accountability in Indian Startups
What transpired at Medikabazaar isn’t about a single executive. Where fraud exists at the top, it seldom occurs by itself. It is indicative of larger governance and culture failures—where cuts, pressure for high growth, and weak enforcement fuel the hurricane.
As India dreams of being a hub for global innovation, the startup ecosystem will have to transition to one of trust, compliance, and speedy justice. Sound ethical systems and open practices will not only shield the stakeholders but also draw higher quality of capital and partnerships in the long term.
In short, the reaction to Vivek Tiwari’s dismissal at Medikabazaar highlights the need for governance and integrity in India’s rapidly changing startup ecosystem. Only a resolve to do business the right way will reward innovation in the long term.
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