Deep tech startup Saarthi.ai is facing major difficulties as it has been unable to pay salary arrears to both former and current employees for the past one year. The company has also cut its workforce by over 70%.
According to Entrackr, Saarthi.ai has reduced its workforce from 140 to 40 since March 2023, with many employees still waiting for their salaries to be paid. Moreover, the company has not paid tax deducted at source (TDS) to the government for the last two financial years.
A PTI report in July 2023 covered the layoffs and arrears without giving details. CEO Vishwa Nath Jha assured that the arrears would be paid within three months.
Salary not paid despite legal notice
Former employees, speaking anonymously, said the company has not paid the salaries of more than 50 employees for over a year and has not responded to legal notices, with the founders reportedly not responding and claiming they are not owed an explanation.
On allegations that the company was deliberately delaying salary payments, Jha denied the allegations and suggested it was an attempt to tarnish the company's reputation. He mentioned the company's plans to fill key positions as it negotiates with several banks and non-banking lenders.
Jha also claimed that a former senior employee had stolen his passport with a U.S. visa, preventing him from traveling to raise funds. He has since had his passport reissued but is waiting for a new U.S. visa. Jha claimed the startup has yet to generate enough surplus cash to clear years of outstanding debts. He also admitted that ThirtyEye had not paid withholding taxes for the past two years.
He emphasized that the company has been transparent with affected former employees and is working to be cash-flow positive by the second quarter of 2024. Saarthi.ai is also in talks with investors to raise new capital to address outstanding debt and liabilities.
Founded in 2017 by Jha, Sameer Sinhaa and Sangram Sabat, Saarthi.ai specializes in conversational AI for low-resource and global languages including Indian, South Asian, Arabic and European languages. The Bangalore-based startup is funded by Kunal Shah's QED Innovation Labs, Capri Global Capital, Lead Angels Network and others.
