Dunzo raises $75M, cuts 30% of staff in business revamp: report

Indian online delivery platform Dunzo is undergoing a major revamp of its business model, which includes securing $75 million in funding through convertible notes and laying off approximately 30% of its staff, according to a report by the Economic Times. The move is aimed at ensuring profitability within the next 18 months. The layoffs, affecting over 300 workers, are part of a larger restructuring plan announced by CEO Kabeer Biswas at a town hall meeting on Wednesday. The funding was led by key backers Reliance Retail and Alphabet Inc, who contributed about $50 million, with other existing investors contributing the rest.

Dunzo raises $75M, cuts 30% of staff in business revamp: report

Under the new business model, Dunzo will cut about 50% of its dark stores and only run those that can be profitable or are close to reaching that threshold. The company plans to partner with supermarkets and other merchants. Dunzo, Google, and Reliance Retail declined to comment on the report.

The delivery platform’s decision to streamline its operations comes amid increasing competition among companies that offer speedy delivery of household goods, with players intensifying their battle to ensure users can get their orders within 15 minutes or less. Dunzo is also in talks with other investors, such as Abu Dhabi Investment Authority (ADIA), but any further capital injection may only come after the business has stabilised and certain metrics have been met.

The move towards profitability is not unique to Dunzo, as many Indian startups are under increasing pressure from investors to achieve profitability amid rising costs and a slowing economy. Despite the challenges, India’s e-commerce market is still growing, with the country’s retail market projected to reach $1.3 trillion by 2025, according to a report by the Boston Consulting Group.

Here are some details of Dunzo 

Company Name Dunzo
Industry Delivery and Logistics
Headquarters Bengaluru, India
Founded 2015
Founder Kabeer Biswas
Funding $125 million (as of April 2021)
Investors Google, Reliance Retail, Lightbox, STIC Investment, 3L Capital, and others
Number of Employees 1,800 (before recent layoffs)
Recent Developments Secured $75 million in funding, laying off 30% of staff, and revamping business model to focus on profitable dark stores and partnerships with supermarkets and merchants
Services Hyperlocal delivery of food, groceries, medicines, pet supplies, and other household items
Operating Cities More than 13 cities in India, including Bengaluru, Delhi, Mumbai, Chennai, and Hyderabad
Competitors Swiggy, Zomato, Amazon, Flipkart, BigBasket, and others

 

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