Dunzo to undertake further layoffs as cash flow crisis deepens

economictimes.indiatimes.com:

Dunzo is set to undertake another round of layoffs amid a fund crunch, cofounder and CTO Mukund Jha told employees in an all-hands meeting on Wednesday evening. Thelayoffs are part of the firm’s decision to reduce costs by 30-40%, as ET had reported on Wednesday. Chief executive Kabeer Biswas was in Mumbai on Wednesdaymeeting existing investors to secure fresh funds.

ET had first reported on the imminent job cuts on July 10. Questions emailed to Dunzo about the job cuts announced last evening did not immediately elicit a response. Earlier on Wednesday, the company told employees it would defer unpaid salaries for the months of June and July to September 4, when it would pay them along with the August salary.

According to multiple people, Dunzo employees expressed anxiety to the senior leadership after they were told that the salary payment would be deferred. Dunzo is also in talks with Reliance Retail, its largest investor, which has a stake of about 26%, to raise around $20 million as it faces a funding crunch, ET reported on Tuesday. Amid the cost cutting, the firm’s head of product, Akansha Kumari, is leaving the company, people aware of the matter said.

Kumari has been in Dunzo for nearly four years. The Bengaluru-based firm, which is also backed by Google, has already fired close to 400 employees so far this year in two rounds. Over the past few weeks, CEO Biswas has been briefing staff about the need to save cash to run operations longer, while shifting focus fully to the business-to-business unit Dunzo Merchant Service (DMS).