BluSmart row: Hotmail co-founder warns against rushed judgments in startup world

Sabeer Bhatia cautioned that overreacting to isolated incidents could stifle innovation and risk-taking—essential to entrepreneurship—as constant public scrutiny may deter aspiring founders from building boldly and taking the necessary risks to succeed

Tech entrepreneur and Hotmail creator Sabeer Bhatia has spoken out amid growing scrutiny of electric mobility startup BluSmart, urging a more measured and responsible public discourse around the issue. His remarks come at a time when the company faces mounting accusations regarding its financial conduct.

BluSmart, known for its electric ride-hailing services in India, is reportedly under investigation for alleged misuse of company funds, including expenditures on upscale apartments and elite club memberships. While these claims have yet to be independently verified, the situation has sparked significant debate within India’s startup community.

In a social media post, Bhatia refrained from making a judgment on the matter but voiced concern about the increasing role of media narratives in shaping public opinion before facts are established. “There’s a lot of noise around BluSmart and the alleged misuse of funds,” he wrote. “Whether they’re true or not is still unclear.”

Call for responsible media coverage

Bhatia stressed that although any confirmed wrongdoing should be thoroughly investigated, using such incidents to cast doubt over the entire startup ecosystem is both unfair and damaging. “We are judging the entire startup ecosystem before the facts are even on the table,” he cautioned.

He pointed out that overreaction could discourage innovation and risk-taking—key ingredients in entrepreneurship. “Entrepreneurs take risks. If every misstep becomes a spectacle, fewer people will dare to build,” Bhatia said.

He further emphasized the fragile relationship between public perception, investor trust, and capital flow. “Public perception matters. Trust fuels capital. And both die fast in a climate of paranoia,” he noted.

Calling for responsible journalism, Bhatia urged media outlets to uphold their duty to inform without resorting to sensationalism. “Let’s fix what’s broken,” he concluded, “but let’s not burn down what’s being built.”

His comments come at a critical moment for Indian startups, many of which are grappling with heightened regulatory attention, underscoring the delicate balance between accountability and sustaining a culture of innovation.

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