Artha Venture Moves To Oust Hornet CEO Over Alleged Governance Breaches
•February 13, 2026
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Why It Matters
The clash threatens confidence in VC‑backed crypto startups and raises red flags for government agencies relying on such firms for critical blockchain investigations.
Key Takeaways
- •Artha Venture invoked shareholder rights to oust Hornet CEO.
- •Allegations include misusing seed funds and copying code.
- •CEO denies claims, files FIR, cites improper EGM notice.
- •Hornet provides crypto forensics to Indian law enforcement.
- •Dispute highlights governance risks in VC‑backed blockchain startups.
Pulse Analysis
India’s venture capital landscape is grappling with heightened scrutiny over governance standards, especially in high‑risk sectors like blockchain. Artha Venture’s decisive move to oust Hornet’s CEO illustrates how investors are increasingly willing to intervene when fiduciary duties appear compromised. While seed funding of ₹4 crore enabled Hornet to develop a platform that tracks illicit crypto activity for agencies such as the Enforcement Directorate, the alleged misuse of those funds threatens the credibility of both the startup and its backers. This case serves as a cautionary tale for VCs to embed robust oversight mechanisms early on.
The allegations against Souvik Haldar—misappropriation of capital, external employment with a client, and unauthorized data extraction—strike at the core of operational integrity. If proven, such breaches could jeopardize ongoing investigations, erode trust with law‑enforcement partners, and expose the startup to legal liabilities. Conversely, Haldar’s denial and claim of an improperly convened extraordinary general meeting highlight the procedural complexities of corporate governance under India’s Companies Act. The dispute underscores the need for clear, transparent board processes and timely communication to prevent escalation into public confrontations that can damage market perception.
Beyond Hornet, the episode signals broader implications for India’s burgeoning crypto‑forensics niche. Government agencies increasingly rely on agile startups for real‑time blockchain analytics, making the reliability of these partners paramount. Investors must balance hands‑off support with active monitoring to safeguard both financial returns and public interest. Strengthening governance frameworks, enforcing statutory notice periods for EGMs, and establishing independent audit trails can mitigate similar conflicts. As the ecosystem matures, the Hornet saga may prompt regulators and VCs to codify stricter compliance standards, fostering a more resilient environment for innovative fintech ventures.
Artha Venture Moves To Oust Hornet CEO Over Alleged Governance Breaches
Early stage VC firm Artha Venture Fund has initiated the removal of the cofounder and CEO of Kolkata-based blockchain startup Hornet. The firm’s managing director Anirudh Damani took to social media platform X to share that the investor has exercised shareholder rights to remove the CEO of a portfolio startup.
According to Damani, Hornet’s cofounder and CEO Souvik Haldar engaged in governance breaches, including allegedly diverting seed funding proceeds for personal expenses. He further claimed that Haldar took up paid external employment with one of the startup’s clients while using company resources, and copied sensitive company data onto personal devices.
“When this was found out, he tried to destroy evidence, threaten employees… and copied the entire code base of the company, including active investigations that were ongoing with law enforcement agencies that were conducting their work through his platform onto a hard drive and then taking that hard drive off company premises,” he said.
Founded in 2023 by Haldar, Subhrojyoti Mondal and Shreyan Gupta, Hornet is an Indian cryptocurrency forensics and intelligence platform designed to track and analyse illicit activities on the blockchain, such as fraud, money laundering, and darknet transactions.
It claimed to be working with multiple government agencies including the Enforcement Directorate, Telangana Police and West Bengal Police on real-time blockchain and cryptocurrency tracing.
The startup was incubated at the Indian Statistical Institute (ISI), Kolkata, and received a ₹4 Cr in a seed funding round from Artha Venture in February last year.
According to Artha’s Damani, once legal proceedings started against Haldar over the last month, he tried to remove the company’s cofounders and take complete control of the board of directors by holding unauthorised extraordinary general meetings (EGM) to have other board members voted out.
He also alleged that Haldar employed his father as an internal accountant for the startup without consulting others on the board.
Damani highlighted the risk that government agencies take when contracting early-stage startups like Hornet, and how it is the prerogative of industry stakeholders to ensure that government agencies are comfortable taking this risk.
“Employees were being threatened, systems were locked, data was copied, and government relationships were implicated. In a young ecosystem, protecting people and trust mattered more than quiet handling,” Damani said when questioned on his decision to make this public.
Founder Refutes Misappropriation Allegations
As of now, it is unclear whether the CEO has officially stepped down from his position. Inc42 hasn’t received an official statement from the cofounder or the startup on the allegations as of now.
However, speaking with ET, Haldar categorically denied Damani’s claims and said that he has filed an FIR with the Kolkata police against his removal from the company. “All these allegations are false. Nothing like that has really happened,” Haldar was quoted as saying.
Haldar alleged that the investor was interfering in the day-to-day operations of the startup, which was hampering its growth. He further stated that he had taken the appointment at the client company on behalf of the startup and the proceeds would have been directed to Hornet’s balance sheet.
He also denied copying sensitive data to his personal hardware, noting that the startup does not store critical information or personally identifiable information (PII).
Haldar further said that he was removed through an improperly convened meeting and was given only 10 minutes notice before the EGM convened as opposed to the mandatory 21 days required under the Companies Act. He is reportedly pursuing legal action against the same.
The post Artha Venture Moves To Oust Hornet CEO Over Alleged Governance Breaches appeared first on Inc42 Media.
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