Manish Maheshwari, the former head of Twitter India, is leaving the startup he co-founded just six months ago following disagreements with co-founder and investors.
"I am moving out of Invact to first take a break for a few months and then pursue new opportunities. It is heartbreaking for a founder to leave the startup, like a mother leaving her baby. I am going through the same emotion," Maheshwari, who served as the startup's chief executive and managing director, wrote in a tweet.
Maheshwari left Twitter late last year to start Invact Metaversity with Tanay Pratap, a former Microsoft employee, TechCrunch first reported. The startup, which has raised $5 million to date, seeks to launch a metaverse where cohorts of students could take classes. But the startup has so far struggled to ship a product as the two founders locked horns and disagreed on the vision, according to a startling email Pratap sent to its investors earlier this month.
Invact, an edtech whose chief executive is former Twitter India head (Manish), explored sale earlier this month but could not find a buyer, according to an email the other co-founder (Tanay) sent to investors. Tanay describes "irreconcilable differences" with Manish in the email. pic.twitter.com/uG3heZW3lp
— Manish Singh (@refsrc) May 22, 2022
Maheshwari, who owned more equity of the startup than Tanay, according to a person familiar with the matter, assumed broader control over the startup's direction.
"We are now standing at crossroads exploring possibilities such as (a) cutting the burn rate and pivoting to another idea, (b) letting one of the founders take full charge, or (c) returning the unspent capital to investors," Maheshwari tweeted earlier this week following media reports of the tension between the two founders.
Things suddenly became more complicated after Gergely Orosz, an early backer of Invact, publicly called out Maheshwari for allegedly not listening to any investor, reneging on exit agreements and holding the startup "hostage."
"Manish has been bullying Tanay into silence, threatening to use the company funds of $1.7M - including our angel investment money - to sue him, should Tanay speak ill of him in public," Orosz wrote to investors this week in an email, reviewed by TechCrunch.
"This broke the straw with me, as that includes my money: which I never invested to be used as an instrument of a cofounder bullying the other one. Manish keeps walking back on promises he made to named investors, then breaking them. Names investors were meeting the terms he put up to accept the exit settlement so the company can continue operating. He then walks back on these terms. He has been doing this for weeks," he wrote.
Invact raised a $5 million round earlier this year from Arkam Ventures, Antler India, Picus Capital, 2am VC and dozens of angel investors at a valuation of $33.5 million. It was putting together a new round at a $100 million valuation, according to a source familiar with the matter. Later it explored sale of the business, but could not find a buyer.
"The decision to part ways was not an easy one, but ultimately, Manish and Tanay had diverging visions for the company's long-term prospects. Invact will continue and under leadership of Tanay will pursue its vision to make quality education accessible via Metaversity," the startup said in a statement today.
In his Twitter thread today, Maheshwari described Tanay as "brother."