Grocery delivery platform Dunzo has cut the company’s workforce by 30%, laying off about 300 employees. The company also got funding of $ 75 million from existing investors. These moves may help the delivery platform become profitable before its initial public offering in 2025.
Dunzo informed the company employees about the layoffs in a town hall on April 5. It said it was looking at a pivot in business strategy to achieve profitability ahead of the planned initial public offering.
In January, Dunzo’s CEO, Kabeer Biswas, said that the company was looking at organizational changes and re-organization that can affect employees.
Dunzo also laid off employees in January
In January this year, Dunzo laid off 3% of its workforce because of restructuring.
Kabeer Biswas, co-founder and chief executive officer of the company, said that as they scale from 10 to 100, they are learning how to redefine business processes. He said any decision that impacts people is difficult and will always be their last option. But, they had to part ways with 3% of their team strength.
According to the information available on LinkedIn, the company had about 3,000 employees at that time. This meant that the startup had cut around 90 employees. However, Dunzo did not disclose how many employees it had laid off.
However, CEO Kabeer Biswas further said that whatever the numbers are, these are the employees who build their careers with Dunzo, and he said that it is sad to have talented colleagues leave them. They extend the best support possible to help these employees during this transition.
The company raised $ 240 million in January 2022 in a funding round that Reliance Retail Ventures Ltd led. This also saw other investors participate. The event included Lightbox and Lightrock. This was at a post-money conservative valuation of dollars 800 million. The company wanted to raise another $ 250 million to 300 million to help with its expansion plans and fund its quick commerce business.
In the financial year 2022, the company lost about ₹464 crores from ₹229 crores in the previous fiscal year. Its operating revenue rose to ₹54.3 crores from ₹25.1 crores in the financial year 2021.
Kabeer Biswas said in an interview last year that the company initially had planned for a public listing in 2023 but now allows for more time for its quick commerce business to get better and mature before going public. Its quick commerce category is getting built in the next 2 or 3 years.
Over the past many months, about 17,000 people lost their jobs. This is because Indian startups cut their workforce to become profitable. Besides Dunzo, other companies also announced massive layoffs. For example, Mohalla Tech Pvt. Ltd (ShareChat’s parent firm). It fired around 20 per cent of its employees, giving reasons as external macro factors. Similarly, Rebel Foods (a Cloud kitchen brand), which operates several other brands like Behrouz Biryani, Faasos, Oven Story, and the edtech unicorn Lead School, has recently sacked several employees.
About Delivery Platform Dunzo
Dunzo is an Indian grocery delivery platform that delivers groceries and essentials like fruits, meat, vegetables, food, pet supplies, and medicines in major cities.