Layoffs continue! Now, Google-backed Dunzo fires 3% of its workforce

Google-backed delivery platform Dunzo has announced the layoff of 3 per cent of its workforce, citing restructuring. With this move, the company joins the club of Indian startups that have been reducing their workforces to reduce costs. However, the exact number of employees laid off is yet to be revealed.

"As we scale from 10 to 100, we are learning how to redefine business processes at scale. Any decision that impacts people is tough and always our last option. Last week, we had to part ways with 3% of our team strength," said Kabeer Biswas, co-founder and chief executive officer (CEO), Dunzo.

A total of 3,000 people are employed by Dunzo, according to data that is readily available on LinkedIn, so the startup has let go of about 90 workers.

“Whatever the numbers, these are people who chose to build their careers with Dunzo, and it is sad to have talented colleagues leave us. We are extending the best support possible to help them during this transition," Biswas added.

In January 2022, Dunzo raised $240 million in a funding round that was co-led by Reliance Retail Ventures Ltd. and included participation from Lightbox and Lightrock, with a post-money "conservative" valuation of $800 million.

In order to fund its quick commerce business and assist with its expansion plans, it was looking to raise an additional $250 million to $300 million.

Due to high operational costs, the hyperlocal delivery startup reported a net loss of Rs 464 crore in FY22, a 2X increase from Rs 229.1 crore in FY21. According to the company, its delivery-related expenses rose 4.6X to Rs 134 crore in FY22 from Rs 29.4 crore in FY21, accounting for 25.2% of total spending.

Meanwhile, ShareChat, an Indian social media start-up with backing from well-known investors like Twitter, Google, Tiger Global, and Temasek has laid off 20% of its workforce, which will basically affect 400 employees.