Mumbai: Influencer Led video commerce platform Trail has not paid its dues to a section of content creator For the past 6-7 months, three creators told ET.

about 100 employees of trellis A source familiar with developments said either left voluntarily or has been removed from the company in the last two months.

trail, which was being done
Forensic team of EY India investigated According to sources, it had dealt with 1,000-1,500 creators at a time, in view of alleged related party transactions, misreporting of business numbers and other financial irregularities.

Sources said it hasn’t paid a “significant” number of creators.

However, ET could not ascertain the exact figure.

Trail’s community page on Instagram had several comments from creators, such as “Please clear pending payments”, prompting the company to pay.

Trail was actively deleting these comments.

At least one creator also alleged that the company was only paying influencers with large followers on popular social media platforms like Instagram, while not paying creators with a relatively small number of followers.

Trail, on his part, denied the allegations.

“Trail pays all its creators in accordance with our contractual agreements with them. A small percentage of creators work through their agencies. Trail has approved payments with agencies as well,” the company said in a statement. “However, it has come to our notice that some agencies are delaying payments. Although this is an agency-producer discrepancy, we are actively working with them to ensure that our creators are Take care and payment should be made as soon as possible…”

Launched as a lifestyle-focused short video app, Trail gained prominence when the video app boomed in 2020 due to a ban on the Chinese short-video app TikTok.

At its core, Trail wanted to build a large base of content creators who would fuel their video commerce ambitions by selling products on Trail Shop, its online marketplace, for Tier 2 and Tier 3 audiences.

The marketplace has brands like Lakme, Mamaearth, Maybelline and Wow skincare.

Co-founder and chief executive Pulkit Agarwal had earlier told ET that till July last year, Trail had trained over 1,000 creators, of which the top creators earned Rs 2 lakh per month.

“Everyone is facing this issue with them. He owes more than Rs 30,000 for the promotions done by me. As a student, this is a huge amount for me,” said a lifestyle influencer who had a one-year contract that expired in March.

ET can verify from the screenshots of its dashboard that the company owes around Rs 35,000 as of June.

ET has also reviewed screenshots of the conversation between Trail and the influencer, which explained how the company was withholding payments and did not respond to the creator’s query for clearance.

One of the sources said that as of November last year, Trail had producers on the payroll and was paid to create the content.

As the focus grew on monetizing content and its marketplace, it tied the earnings of creators to creating branded content and paying them 5% to 10% of the Trail Shop merchandise they sold.

ETtech

Trail held a percentage of the total gross merchandise value sold on the Marketplace.

The company began disclosing three months ago amid the ongoing investigation by EY into its books of accounts,
ET had reported on March 12.

The EY Forensics team was probing related party transactions and other financial irregularities alleged by its founders. in the same month,
Trail lays off 300 employees Amid rising uncertainty over the company and talk of the funding round being stalled.

Trail also sold
10% stake in AppsForBharat For an existing investor, Mirae Asset.

Middle East investment fund MSA Novo also bought shares of AppsForBharat from influencer-led video and shopping app in a secondary transaction of $9-$9.5 million, ET was first reported on April 4.

the trail was
Raised over $62 million As of July last year, from Mirae Asset, H&M Group and LB Investments, as well as Sequoia Surge.