Info Edge Co-founder Sanjeev Bikhchandani on Friday called the company’s investment in 4B Networks, a proptech venture founded by Rahul Yadav, a mistake.
In a call with analysts following the first quarter results of Info Edge, Bikhchandani said, “It was a mistake and we have to admit it.”
Info Edge invested Rs 288 crore into 4B Networks, including Rs 276 crore as equity and Rs 12 crore in debt. The company announced in the Q3 FY23 financial results that it wrote off its investments in 4B Networks due to suspected financial irregularities.
Info Edge had a 57% stake in 4B Networks.
In June this year, Info Edge initiated a forensic audit into 4B Networks as the proptech startup did not share financial information despite repeated requests. In a notice to the stock exchanges, Info Edge said it has been seeking information including details of financial transactions and related party transactions—which were mandatory disclosures under the agreement—but 4B Networks has not responded.
“Sometimes you make a mistake,” Bikhchandani said. He added that while Info Edge lost money in some companies, it had made substantial returns in others.
Following the 4B Networks debacle, Info Edge has reviewed its investment process internally, upping its due diligence.
“Companies go under but fraud is a different thing,” Bikhchandani said.
Edited by Affirunisa Kankudti
