MapMyIndia cancels investment in CEO Rohan Verma’s startup, shifts focus to…

In a surprising turn of events, MapMyIndia has announced that it will not proceed with its planned investment in the startup founded by its outgoing CEO, Rohan Verma. The decision, revealed on December 9, follows a change in the company’s strategy regarding business operations.

MapMyIndia’s investment decision was reversed

MapMyIndia’s board of directors stated that they will no longer make any equity or debt investments in Verma’s new venture. “The board has decided to realign its investments in the B2C segment while continuing to evaluate other opportunities in the sector,” the company said in an official statement. The change comes after MapMyIndia had earlier approved an investment plan to inject Rs. 35 crore through compulsorily convertible debentures (CCDs) into the startup, which will secure a 10% stake.

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The company’s announcement resulted in a notable increase in its share price, with the stock closing nearly 16% higher at Rs. 1,910, up from Rs. 1,646.60 at last session’s close. The decision to withdraw the investment was taken at the end of the market session, following an application to the Bombay Stock Exchange (BSE).

Rakesh Verma, Chairman and Managing Director of MapMyIndia, emphasized that both the November 29 and December 9 decisions were taken keeping in mind the interests of the company and its shareholders. “These steps have been taken to ensure the best outcome for the company and its shareholders, including minority shareholders,” he said.

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Shifting focus to the B2B segment

Looking ahead, MapMyIndia will focus on strengthening its presence in the B2B and B2B2C segments, which account for over 99% of the company’s revenue. These areas are considered important for future growth, as stated in the company’s statement.

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Initially, the company planned to invest 1,000,000 VND. 35 crore into Verma’s startup, which operates in the B2C sector. However, after receiving concerns from minority investors, Verma decided to finance the venture himself. “Instead, I will use my money to run the startup,” Verma explained in a statement to The Economic Times on December 3.

Verma, who will step down as CEO by April 1, 2025, will continue to serve on the board as a Non-Executive Director.