Cash-strapped Dunzo cuts workforce to 50 as it searches frantically for capital

livemint.com:

BENGALURU : Reliance Retail-backed Dunzo has laid off 150 employees in a fresh round of layoffs, leaving the e-commerce delivery firm with just 50 employees in its core supply and marketplace teams, two people aware of the development told Mint. The Bengaluru-based firm is looking to claw back profits to pay off liabilities including salaries of current and former employees as well as vendor payments as it scouts for capital to survive, they added, requesting anonymity. In May, Mint reported that Dunzo was in the final stages of closing a funding round of $22-25 million in a mix of equity and debt from a clutch of new and existing investors, attempting to “find safety for the company into perpetuity".

However, the transaction is taking much longer to close as many potential investors remain wary of the company’s growth path, one of the two people said. Dunzo’s co-founder and chief executive Kabeer Biswas declined to comment on queries sent by Mint. In an email to employees on Friday, Dunzo said it would pay pending salaries, severance, leave encashment and other dues to affected staffers as soon as it receives funds.

Mint has seen a copy of the email. The company had also considered the option of entering other lines of businesses that complement its core merchants business, and have the ability to make money soon and are operationally light, the two persons added, adding that Dunzo was hopeful the business would turn around in September on the back of its business-to-business segment. Dunzo is yet to pay salaries including full and final settlements to several former employees.