Stayzilla's CEO Yogendra Vasupal has reportedly been arrested in India on charges of defrauding an advertising agency.
The Times of India reported that Chennai city police arrested Vasupal on charges of defrauding Jigsaw Advertising, and Stayzilla cofounder Sanchit Singhi was also named in the First Information Report, the Times of India reported. The publication said a search was underway for Singhi.
Singhi asked in an email for help from Stayzilla's investors after the arrest, apparently stemming from a dispute their company has with its landlord and the firm Jigsaw Advertising, according to the Economic Times.
Jigsaw Advertising told the Times of India that Stayzilla compiled "massive bills" over the past year and had not paid. The company's head, Aditya C S, charged that Stayzilla had threatened him and his family over the bills, the publication said.
Vasupal said in a lengthy blog post on the website Medium.com that Stayzilla announced it was "rebooting" its business in February and that's when problems started with the advertising company and landlord.
Vasupal said in the blog post that the landlord, whom he did not name, assaulted him and verbally berated him and administration team over the course of several meetings in an attempt to settle on an arrangement while the company was in transition.
He stated in the blog that on March 9, police arrived at his home demanding that he come to the police station to address the complaint from the advertising company. Vasupal said on the advice of his attorney he refused to leave because the officers did not have a warrant.
Vasupal also argued that the complaint was against the company and not him, making it a civil matter and he did not personally owe the advertising firm money.
Vasupal's wife, Rupal, said in an update on the blog that neither she nor his attorney know of her husband's whereabouts since the arrest.
Singhi said in email obtained by the Economic Times that he and Vasupal had been threatened and harassed by the advertising firm and filed their own complaint with the Mylapore Police Department before Vasupal's arrest.
Stayzilla started operating in 2005 but the reboot was meant to rethink its business strategy, according to the Economic Times. The publication said Stayzilla had raised about $34 million through four rounds of funding and counts Matrix Partners India and Nexus Ventures Partners among its investors.