Delhi startup founder shuts down company after 'frivolous complaint' by client

Delhi-based entrepreneur Vaibhav Chawla has shut down his warehousing startup, Wherehouse, citing operational challenges after a client’s "frivolous complaint" allegedly led to the police detaining several employees without proper documentation. He announced the closure of his company just two days ago on LinkedIn.
Sources in the Delhi Police, however, dismissed claims of detention, stating that no one is in custody. They added that the police had only received a complaint of cheating, which is currently under investigation.
According to its LinkedIn profile, Wherehouse was founded in 2021 as a supply chain intelligence company, helping brands move closer to their customers, enabling faster and more efficient deliveries, and driving business growth.
In his post, Chawla, one of the startup’s co-founders, said the company had "pushed through every obstacle, capital constraints, operational chaos, and the brutal realities of building consumer infrastructure" to emerge successful.
"We made mistakes, we learned fast, we stayed honest, and we kept showing up every single day. What we built was not small — a real business, real infrastructure, real people, real impact. And a team that gave a part of their life to this dream. We made profits too last year," he added.
Chawla, however, admitted that the past few months had been "brutally hard," and that the company’s sole focus during this period was "taking care of the people who built it alongside us."
According to Chawla, the client escalated the matter with a "frivolous complaint", which eventually led to police action that he says went too far.
“A frivolous complaint, and the line was crossed. In the past few days, the Wherehouse team was detained without any documentation, only to be released after their families arrived at the police station,” he said.
“Wherehouse means nothing if we can’t protect the very people who built it.”
WHAT IS THE COMPLAINT
In a statement to Moneycontrol, Wherehouse said the complaint was filed by Curio Lifestyle, which had approached the startup in July 2024, to expand its business.
Curio Lifestyle and Warehouse entered a formal agreement in August last year. But by November, Curio Lifestyle began defaulting on payments.
Despite repeated reminders, the dues remain unpaid by March this year and as of May 31, the amount stood at Rs 1,92,207.
In June, the client counterclaimed that Wherehouse owed it money, which was rejected by Chawla citing contract terms. However, as the e-mail exchanges escalated to abuses and threats, he terminated the agreement.
According to the startup, the client filed a complaint with the Economic Offences Wing instead of settling the dues. In its defence, Wherehouse said the client's complaint was to evade payment.
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