In a strategic move to streamline its operations, the Bengaluru-based hyperlocal delivery platform Dunzo has announced a significant reduction in its workforce, affecting 75% of its employees. The decision comes in response to financial challenges, including delayed payments to employees and suppliers.
According to a report by Financial Express, Dunzo has laid off 150 employees, which constitutes 75% of its total workforce. This action is part of the companyโs broader cost-cutting measures aimed at improving cash flow and addressing mounting liabilities, such as outstanding vendor payments and overdue employee salaries.
Dunzo has assured affected employees that their pending salaries, leave encashments, severance, and other dues will be settled once the necessary funds are secured.
Dunzo began as a concierge service, and has gone through multiple phases of ups and downs. At its height, the company earned a value of $775 million, but recently, it faced difficulties in securing a vital funding round.
In May 2024, the company was nearing a deal to secure $22-25 million through a combination of equity and debt from investors. Unfortunately, the deal eventually fell apart.
During July 2024, Dunzo notified its employees about the final stages of securing funds and anticipated clearing outstanding payments within 10-15 days. However, follow-up emails revealed ongoing delays as the promised funding did not materialize.
Now the firm is continuously exploring ways to assort its revenue means beyond its main focus of merchant services, which is an essential move to navigate through this critical time for the organisation. With the significant layoff and reduced workforce, it is interesting to see how the company continues with its services to the customers.
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