[RubberGuru1113]

I had spoken to the owner of one of the first GoMechanic garages in Dwarka a couple of weeks back. This was one of the 4-5 initial garages in NCR where the founders ran their pilot before their app launch. He had glowing things to say about the founders, the way they built their understanding (coming from a non-automobile background), how they burnt the midnight oil. He had a touch of disappointment in his tone on the direction the company had taken lately.

They should have focused on offering top notch repair, upskilling the mechanics, and delivering customer delight before expanding to other geographies or even countries, though this is easier said than done due to pressure from VCs and the “pay check to paycheck” philosophy that results.

Uber for instance spent years in one city, before expanding to the rest of the country. I would follow a similar approach, especially in this business.

[holdoyn]

Originally Posted by poloman

Swiggy and Zomato prices are different from restaurant price by atleast 20% Add delivery charges and tax you are paying 30% more. No discounts either. Walk or drive to the restaurant and pick the food yourself if you are averse to dine in.

My friend owns a small restaurant in Hyderabad and he tells me that Swiggy charges a 25% fee and because of that had to jack up his menu price. Unsurprisingly, he opted out.

[Nithesh_M]

Originally Posted by GTO

A cousin shared this. Millions of dollars to invest, but can't even paint a door properly? He'd sent the Baleno to GoMechanic last week for denting & painting of the rear-right door. GoMechanic in turn sent the car to some local garage in Adarsh Nagar.

No QC, no commitment, nothing.

Hmm a Suzuki Baleno/Esteem with a mismatched rear door panel? Where have we seen that before?

Hope the owner has some good lawyer. Otherwise they Better Call Saul

[TSI_Exhaust]

A connected thought ..

Amid recent lay off news from startups, it seems that founders don't think about setting up a long term viable, possible, profitable and honest business. This startup/Shark Tank culture seems like a funding garnering exercise more than anything else.

Have you read about how poorly managed and over valued these businesses are? Recently came across this Twitter thread : https://twitter.com/shantanub/status...xgXnw3GagsCwGw

[Keneida]

"Company ke paas bahot paisa hai", This is what I was told like 3-4 years ago when I had signed up my garage with Go mechanic. And genuinely their business model was good. They charged 10% commission on turnover rather than profits from the leads (leads - App based customers of Gomechanic). They got Gomechanic branded spares, accessories etc, which is a pile of junk honestly, Like how do you justify a windshield wiper going kaput within a week?

After getting to know that the company is firing over 70% of its staff, I feel sad. Because their service advisors were some of the best supportive people around. Go mechanic is nothing without its staff. The on-site staff toiled day and night, worked hard. They constituted mostly BE. Mechanical engineering freshers, their duty was lead management and reporting to higherups for daily targets.

I feel the Founders are to be blamed for this massive accounting blunder, I was on the first dozen whataspp group where the founders were also the admin members, usually they did participate in some abusive conference calls, managed some notorious customers but I feel that later they became complacent and preferred not to be bothered and focused on personal image buildup at the expense of company funds. And that's how they got to this point a few days ago.

I can't deny the fact that some "preferred workshops" were paid excessively as said in the article. A competitor workshop from a different city rented a 300 sqft 4 pole shade open from 3 sides and Go mechanic made it a preferred workshop, It was a footpath makeshift setup. Go mechanic manipulated the ratings of this makeshift setup by putting in images of some Mumbai based Go mechanic franchisee. They even went on to copy paste the reviews from my franchisee to the makeshift one and later we came to know that there was some preferred bias towards us because the regional manager of Go mechanic was in good terms with the competing workshop. Inside job cannot be denied, I mean a tin foil shed was a 4.5 star rated workshop!

With all that being said, I feel that the ground staff is the most hardcore customer focused trained resource. I will definitely vouch for them and recommend these guys for job placements in automobile industry. Whatever has happened is bad for employees, they are the victims and the founders are just trying to save their skin by all means possible.

[zaks]

This is not the first and won't be the last. The VC funding for startups was like bottomless pit of dollar money available for anyone with a reasonable business plan. Most start off like that but they really cannot keep up with the projections they did to get VC funding because reality is hard and situations change. But now with inflation running high the VCs don't spill out money without some hard data and that is what got them.
All those people who will lose their jobs will have to find alternatives, but we have to remember that because of startup galore they are able to find new jobs in the first place.

[arjab]

Originally Posted by holdoyn

My friend owns a small restaurant in Hyderabad and he tells me that Swiggy charges a 25% fee and because of that had to jack up his menu price. Unsurprisingly, he opted out.

True. And Swiggy and Zomato are particularly harsh with new restaurants and food places that sign onto their platform. Their approach to partner established, reputed restaurants in an Indian cities is totally different. They literally grovel before the management and agree to "special rates of commission" which can be as low as 4%-5%. Because they know the reputed eatery couldn't care less-Swiggy or not!

Coming to the problem at hand: GoMechanic never had any experienced automotive person headng their operations particularly the retail and spare parts side of things.
Workshops were signed on arbitrarily, no quaity audit was done on work delivered to end customer, no checks on the authencity of spare parts. Worst were the local people engaged by GoMechanic to "shepherd" the local garages. I do not know about other Indian cities, but I have seen some of these gents in Chennai and Kolkata, the two cities I frequent, and woe betide those who deals with these jokers!
My friend in Kolkata was seriously thinking of signing up with GoMechanic. He even met their local management and decided not to go ahead. Thank heavens for that!

[bullitt1]

Another day, another story. I had booked a Spark routine service with them, but after talking to one of them, didnt have even the slightest of confidence to let car go, eventually backed off.

[shubhsd]

This statement from Amit Bhasin had me offended at a specific term he used. He called himself an entrepreneur. This word has been much maligned!

The core essence of an entrepreneur is that he/she creates wealth for the society, for himself/herself and his/her family. He sustains an economy. Needless to say, that there is an underlying bedrock of ethics which is non-negotiable. He fails on both counts. He should not have called himself an entrepreneur. Passion to look for problems and solutions, process oriented etc is balderdash! An tea vendor on the roadside is a true entrepreneur, he is creating wealth where there was none. He may not be solving a major problem, but has a running enterprise which creates wealth every day. Unlike GoMechanic.

[alpha1]

Originally Posted by GTO

Errors in financial reporting is a polite way of saying, we lied / committed fraud.

.
.
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In the midst of all the fancy degrees from top institutions, renowned board members, millions of dollars in funding, "big ideas" and out of the box thinking, some startups get the basics horribly wrong & die.

You need to keep in mind that cash-out is one of the most lucrative deal for startup founder, especially if you've run business for some time and realize that scaling up will take long time and ultimately yield only low margins.

Whatever it takes to get high valuation, you are labeled a thief only if caught.

Also, I think the founder is no different in being immune from selfish interests - I remember many Sales VPs trying channel stuffing strategies (including onboarding dubious channels and booking fake orders) (of course hand in glove with the GM of the business) to portray a rosy picture to goras abroad in order to retain his job and earn handsome commissions/incentives.

[Nissan1180]

There could be accounting issues and the responsible people should be prosecuted if needed. However, the VCs should not be left untouched. There are so many reports of VCs forcing the company to burn capital and get market share through whatever means.

[vamsi_k_b]

Originally Posted by Nissan1180

There could be accounting issues and the responsible people should be prosecuted if needed. However, the VCs should not be left untouched. There are so many reports of VCs forcing the company to burn capital and get market share through whatever means.

I am not really sure what the VC's have done here. Sure, they will exert pressure on the founder to show hockey stick growth curve. But I am 99% sure they will not tolerate financial fraud. Aren't they one of the parties that got scammed ?

[Nissan1180]

Originally Posted by vamsi_k_b

I am not really sure what the VC's have done here. Sure, they will exert pressure on the founder to show hockey stick growth curve. But I am 99% sure they will not tolerate financial fraud. Aren't they one of the parties that got scammed ?

Yes, this was discovered during a due diligence exercise by SoftBank. What I mean is that the people controlling the capital should encourage its responsible use. Driving up user engagement performance through cash burn to satiate investor expectations is a common practice and when overdone leads to problems.

Also, this fake review issue is widespread in India. Many other brands will be caught if an independent party does this analysis.

[NiInJa]

Last year when my kid's school started, we wanted to repair our scooter, since I was caught up in some work, my wife started looking for such doorstep service app on her phone! They were charging a lot.

I ultimately got the scooter repaired with just the consumables brought at much cheaper rates from a local shop than online.

Although their ideas are nice, most of these startups get their implementation horribly wrong. I am no expert in this matter, but it looks like they all start focusing on the money and the speed at which they should get more of it, rather than improving upon the business itself. The only takeaway for me is I am becoming smarter reading other's unfortunate experiences.

At last:
"Paisa hai, toh sab poochte hai 'kaisa hai?' "

[fhdowntheline]

I would only state the following acronyms : A.S.C followed by F.N.G, period.