Classplus, a software-as-a-service (SaaS) platform for coaching institutes, had acquired Saarthi in late 2021, according to a statement. The deal went unannounced until now.
Both Saarthi and Classplus have submitted their responses to the Delhi High Court and the next hearing is scheduled for September, as per the statement by Saarthi.
Saarthi is an edtech startup offering enterprise resource planning software and solutions for schools. It has raised investments from the likes of Gujarat Venture Finance, Pinnacle Investment Management and LetsVenture.
Saarthi founder Chiraag Kapil and investors have also lodged criminal complaints, naming Classplus and its founders Mukul Rustagi and Bhaswat Agarwal, along with chief financial officer Sankalp Aggarwal as the accused parties. Saarthi has also alleged mental harassment, defamation and theft of immovable property by the Classplus founders.
Classplus – backed by Alpha Wave Global, Tiger Global Management, RTP Global, Owl Ventures, Peak XV’s Surge, GSV Ventures and Blume Ventures – did not immediately respond to ET’s request for a comment on the matter.
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The development was first reported Wednesday by The Morning Context.The list of aggrieved investors includes Kris Gopalakrishnan-backed Axilor Ventures, Innov8 founder Ritesh Malik, $40 million fund Faad Network, Oyo investor Vinod Sood, Polygon investor Rahul Dalmia, among other angel investors.
“Classplus’s failure to pay us (Saarthi’s investors), despite numerous attempts to resolve the issue, is more than just negligence—it’s a glaring sign of bad faith. We investors were left abandoned and deceived, and we demand immediate action. This isn’t just business; it’s a matter of principle, and we won’t rest until it’s rectified,” one of the investors, and Leaf Studios co-founder Ayush Banka said.
Saarthi has also alleged that its founder and CEO Chiraag Kapil was unexpectedly terminated, a few weeks after the transfer of its business operations and employees to Classplus in October 2021. “Furthermore, investors associated with Saarthi have not received their stipulated agreements or the corresponding equity they were entitled to,” it added.
In December 2021, when the term sheet was finally presented, the stipulated clauses diverged from the terms initially agreed upon, Saarthi has alleged. By February 2022, it said, Classplus had access to Saarthi’s proprietary information, workforce, intellectual property and database, even prior to formalising any official agreements.
Saarthi, founded by Kapil, targeted more than 100 million students engaged in competitive exam preparation through online platforms. The acquisition proposal negotiations between Saarthi and Classplus commenced in November 2021.
Classplus, valued at over $600 million in 2022, operates as a SaaS startup, providing tools to educators and coaching centres to create customised applications. The company was founded in 2015.