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Asset financing company Grip Invest told investors on Tuesday that it has initiated legal action against BigSpoon and its Founder-CEO Kapil Mathrani after the cloud kitchen startup failed to pay rent for certain kitchen equipment and other assets.

Grip Invest wrote in an email to investors on Tuesday that it was scheduled to receive rent from Ahmedabad-based BigSpoon, which runs eight brands, including The Pizza People by Mouni Roy and Mehfil Biriyani by Zakir Khan, on September 4 and had stationed a team at the cloud kitchen’s office.

However, the fintech claimed that Mathrani was not reachable either on the phone or in person. Grip said it is in touch with BigSpoon’s senior management, including Co-founder Poojan Thakkar, its investors, and creditors, and alleged that none of them were able to contact Mathrani.

“We were scheduled to receive a rental payout from Mr. Kapil Mathrani (BigSpoon’s founder and CEO) and the Company on 4th September 2023, for which our team was stationed at Company’s headquarters in Ahmedabad; however, in a bizarre turn of events, Mr. Mathrani has been untraceable (either over phone or physically at his residence and office) during the last 48 hours; we have been in regular contact with the Company’s senior management team (including Co-founder and Director Mr. Poojan Thakkar), VC investors, and creditors, and neither of them have been able to contact Mr. Mathrani,” Grip’s email note to investors said.

YourStory has seen a copy of Grip’s email to investors.

WhatsApp messages sent by YourStory to Mathrani seeking clarification on the allegations on Tuesday were not answered. Co-founder Poojan Thakkar, too, did not respond to queries at the time of publication. The story will be updated with the responses when they come in.

In the note, Grip alleged that while it is too early to say whether Mathrani is on a personal trip or has fled the country, the company fears and suspects the latter.

YourStory could not ascertain the total exposure of Grip’s investors to BigSpoon.

The Delhi-based fintech said in the investor note that it has filed FIRs against the directors of BigSpoon as well as the senior management team for potential fraud, and has initiated a civil action against the owners of the kitchens, where the leased assets have been stored to recover them at the earliest.

Grip Invest enables its members to invest small sums of money in non-market-linked alternatives and complementary investment products, such as asset-backed leasing, invoice discounting, and pools of loans.

Grip entered into an agreement with Ahmedabad-based BigSpoon in March 2021 to lease kitchen equipment and other assets underpinned by several merits, including its March 2021 financials, and the experience of founders Mathrani and Thakkar, according to a note shared by Grip to its investors in late August.

In FY22, BigSpoon’s net loss widened by a whopping 169% to Rs 15.02 crore from the previous year, while revenue stood at Rs 17.23 crore. The company said that the net loss was due to high rental and promotional costs and that it would enhance its market footprint to grow its revenue, according to filings with the Ministry of Corporate Affairs (MCA).

Funding crisis

BigSpoon has been struggling to raise money since last year.

Mathrani told YourStory in a conversation on August 24 that BigSpoon has raised a total of only about Rs 31 crore in external funding till date.

More than two term sheets for additional funding fell through between May 2022 and June 2023, largely due to the funding winter, according to Mathrani.

The firm announced in August 2022 that it had raised Rs 100 crore from Indian Angel Network, NB Ventures, and LetsVenture, among others. However, the announcement was based on commitments received from the investors and did not translate into funding, Mathrani confirmed to YourStory in August.

The company is also undergoing a pivot from company-owned to franchise model, wherein BigSpoon will franchise most of its brands by retaining control of the menu, strategy and marketing while the franchisee would be in charge of recurring payments like staff salary, vendor payments, and rent, said Mathrani in August.

“It has always been about a working capital challenge,” Mathrani had said. Without divulging details, he added that BigSpoon is in talks with a few existing investors to raise another small round to fuel the change in the business model.

As of FY22, BigSpoon operated 61 outlets across 20 cities in India, according to the company’s FY22 financial statements.