Indonesia’s US$1.4 billion fish start-up faked most sales, report claims

EFishery was a darling of the nation’s start-up scene. Then a whistle-blower alleged that the company’s accounts weren’t accurate

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A bucket of fish is seen as fishermen unload their catch at a beach on Indonesia’s Bali island. Photo: AFP

Published: 3:23pm, 22 Jan 2025

EFishery Pte, one of Indonesia’s most prominent start-ups, may have inflated its revenue and profit over several years, according to an internal investigation triggered by a whistle-blower’s claim about the company’s accounting.

A preliminary, ongoing investigation into the agritech start-up, backed by investors including SoftBank Group Corp. and Temasek Holdings Pte, estimates that management inflated revenue by almost US$600 million in the nine months through September last year, according to a 52-page draft report circulated among investors. That would mean more than 75 per cent of the reported figures were fake, the report said.

EFishery, which deploys feeders to fish and shrimp farmers in Indonesia, was a darling of the nation’s start-up scene and scored a valuation of US$1.4 billion when G42, an AI firm controlled by United Arab Emirates royal Sheikh Tahnoon bin Zayed Al Nahyan, backed its latest funding round. It has raised hundreds of millions of dollars in an attempt to modernise the country’s fish industry, providing farmers with smart feeding devices as well as feed, and then buying their produce to sell into the broader market.

Investors were initially enticed by its profitability at a time when lay-offs, CEO resignations and plummeting valuations in the tech sector dominated headlines. It presented a US$16 million profit for the first nine months of 2024 to investors, but the investigation commissioned by the board alleges the firm actually generated a US$35.4 million loss.

EFishery Chief Executive Officer Gibran Huzaifah. Photo: LinkedIn/GibranHuzaifah

Revenue for the period was estimated at US$157 million, rather than the US$752 million investors were told, according to the report. Management also inflated revenue and profit numbers for several previous years, the report said.

The report was initiated after a whistle-blower approached a board member with allegations that the accounts weren’t accurate, according to people familiar with the matter. The board then commissioned a formal investigation in December, and dismissed co-founder and Chief Executive Officer Gibran Huzaifah after the accounting inconsistencies were discovered, the people said.