Indian e-commerce firm lays off 251 employees
2 min read . Updated: 05 May 2023, 12:21 PM IST
PremiumMeesho Founder and CEO Vidit Aatrey informed that all sacked staffers will get one-month extra severance pay beyond the notice period as well as ESOPs irrespective of the period they have been with the company.
E-commerce firm Meesho has laid off 251 employees constituting 15% of its workforce to cut costs and as part of its efforts to achieve profitability, a top company official said on Friday.
In an email to employees, Meesho Founder and CEO Vidit Aatrey informed that all sacked staffers will get one-month extra severance pay beyond the notice period as well as ESOPs irrespective of the period they have been with the company.
“We are reducing the size of the Meesho workforce by 15% affecting 251 employees," the email read as quoted by news agency PTI.
The company grew 10 times from 2020 to 2022 which was aided by Covid tailwinds and aggressive investments.
"Even as we tracked our plans, the macro climate undeniably and considerably changed. As a result, we have had to accelerate our timeline to profitability as part of Project Redbull, while readjusting our GMV growth goals to 30% YoY. While our cash reserves buffer us well for these harsh circumstances, we need to stay highly prudent on the cost front," Aatrey said.
A recent report by Jefferies had said that Meesho is already contribution-margin positive (pre-marketing and indirect spends) and the company is nearing zero cash burn and is on track to achieve EBITDA breakeven this year, PTI reported.
When contacted, the company spokesperson said, "We have taken a difficult decision to part ways with 251 Meeshoites constituting 15% of the employee base, as we look to work with a leaner organizational structure to achieve sustained profitability."
The spokesperson said that the company is committed to ensuring all those impacted have its full support and will be provided a separation package that includes a one-time severance payment of 2.5 to 9 months (depending on tenor and designation), continued insurance benefits, job placement support and accelerated vesting of ESOPs.
"We remain grateful for their contributions in building Meesho," the spokesperson said.
(With PTI inputs)