'It’s the end': Former BharatPe cofounder Ashneer Grover critiques PharmEasy's plan to raise $300 million

Former BharatPe cofounder Ashneer Grover was vocal in his criticism of PharmEasy's plans to raise around $300 million on Thursday. The former Shark Tank judge asserted that the development would mean "the end" for the stakeholders. He asserted that a ‘down round’ combined with the ‘anti dilutive clause’ would mean “sudden death” for the founders. 

PharmEasy is looking to raise around $300 million in a new round of funding at a time when it faces a 90% markdown from previous valuation. While the company has reportedly seen some interest from different avenues, these deals may drive the company's valuation further south.

“Anti - dilutive clause will kick in, meaning VC investors who invested in the company at more than ₹5/share ever will get more shares so their holding cost comes to ₹5/share. Simply even last round VC investors who invested at ₹55/ share will get 10x more shares for free so their holding comes to ₹5/share. Everyone BUT the Founders and Employees!” he explained in a tweet. 

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According to a TechCrunch report cited by the entrepreneur, the pharmacy firm is looking to raise fresh capital in order to pay lender Goldman Sachs. The company had previously borrowed around $285 million in 2022 to pay off an earlier debt. This incidentally had been necessitated by its decision to move forward with a a majority stake acquisition of Thyrocare for over $600 million.

“Founders plus ESOP holding will become 0.001% or some similar fraction! Debt taken in 2021 will turn out to be the most expensive capital raised by founders ever,” Grover warned.

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A Moneycontrol report on Wednesday indicated that the beleaguered unicorn had pledged Thyrocare shares as collateral for the loan. Reportedly, API Holding has garnered the eye of Manipal Group as it looks to invest about ₹1,000 crore for an 18% stake (post-money valuation).