Beleaguered Indonesian aquatech unicorn eFishery, which has raised multi-million-dollar funding rounds from investors such as Abu Dhabi’s 42XFund, Malaysia’s KWAP, Switzerland’s responsAbility, Northstar, Temasek, and Softbank, may still have enough runway to sustain operations for a few years, sources told DealStreetAsia.
Yet, not all shareholders are convinced that the startup is worth reviving as there are doubts about the scalability of the business.
eFishery reportedly holds about $55 million in cash, said a source familiar with the matter.
Meanwhile, an employee with access to eFishery’s financial statements told DealStreetAsia, under the condition of anonymity, that its current “cash and liquid assets” exceed 1 trillion rupiah ($61.3 million), while its actual revenue exceeds 3 trillion rupiah ($184 million).
eFishery also has “$95 million in accounts receivable, and even if only half of this is recoverable… it still has over $100 million in cash and equivalents—far surpassing the capital raised by any of its competitors,” said the first source, quoted earlier.
eFishery has also raised more funds than any of its competitors.
According to DealStreetAsia DATA VANTAGE, the startup has raised over $314 million in equity funding from investors, most recently in July 2023 in a $200 million Series D round led by 42XFund. Throw in debt and it has raised close to $400 million.
In comparison, its competitor Aruna has raised $70.46 million so far while Fishlog has raised $1.4 million, according to DATA VANTAGE.
However, despite the company’s rich cash reserves, investors are divided on whether to find a new management and revive the company.
While some believe eFishery has the financial strength and potential to scale, others are less optimistic given the effort required to rebuild the company and the recent reputational damage it has suffered.
The sources added that some large investors are reportedly ready to write off their investment and wind down the company.
DealStreetAsia has reached out to eFishery regarding its financial position.
A forensic report by a global consulting firm, which is expected within the next 6-8 weeks, will likely play a decisive role in determining the company’s viability. Its recommendations to the board will influence the fate of employees and the ecosystem it has supported for years.
The forensic audit, details of which were accessed by DealStreetAsia, alleged that the company’s former management had inflated its revenue for the first nine months of 2024 by nearly fivefold and manipulated its bottom line to appear profitable despite posting massive losses.
The global firm is proceeding with targeted actions to uncover the full extent of alleged financial fraud including: conducting re-interviews with key individuals, analysing transactions and verifying irregularities within the company’s records, conducting asset verification, and investigating the round-tripping between eFishery’s Indonesian entities and five nominee companies.
eFishery is also reportedly leaderless following the resignation of interim CEO Adhy Wibisono. According to one board member, Wibisono’s departure is unlikely to impact the company’s immediate prospects as the firm has a strong management team, ready to step in when necessary.
Union’s demands
eFishery’s labour union, the Serikat Pekerja PT Multidaya Teknologi Nusantara (SPMTN), has voiced its dissatisfaction with the company’s current trajectory and its impact on employees. The demands include: avoiding mass layoffs, resuming business operations, and clarifying fraud allegations.
The demands were shared during the peaceful emergency town hall held last week outside the company’s office in Bandung, West Java, and attended by a representative on behalf of the management to accommodate some of the union’s demands.
“Management has promised to take immediate action on restarting operations and addressing public concerns regarding fraud. However, there was no direct discussion regarding the rumoured layoffs,” said the union spokesperson to DealStreetAsia.
