Consumer internet search platform AskMe has shut down its operations, laying off remaining of its staff,as per reports.
Despite the shutdown, AskMe’s ecommerce website is still live . It’s possible that the service might not deliver, although one can still order something.
AskMe, a hyperlocal e-commerce company, has been facing troubles since the start of the year when its primary investor, Malaysia-based Astro Holdings defaulted on payments to sellers, own employees and other dues. The bills had amounted up to $15 Million from January 2016, and since Astro has 98.5% stake in AskMe, the company had to rely on just one source of income.
AskMe Group CMO, Manav Sethi talked about a possible buyout,
“Astro is pulling out of all business and its investments in India because of the political and legal issues. AskMe Group has made a management buyout bid and leadership team is working towards taking over the company.” However, this failed to see the light of the day because of Astro.
Recently, AskMe saw resignations from more than 650 employees who were in the annual salary bracket of INR 2.5 lakh-INR 6 lakh.
The shutdown has left more than 4000 employees, vendors, and other creditors at AskMe and the investor, in a state of panic.
AskMe.com was started as a classified portal in 2010. The company launched its online shopping portal Askmebazaar in 2012, which focused on small and medium enterprises. Later in 2013, AskMe was acquired by Getit.
The portal is associated with more than 12,000 merchants across 70 cities. It also entered the hyperlocal space with Askmebazaar’s next day delivery, and the fintech space with AskMePay’s AskMeFin. The company also invested $20 million in online furniture marketplace Mebelkart in August 2015.
The future does look bleak for the company, but it is also an important lessons for startups that rely on just one majority investor.