Dunzo, a delivery company backed by Reliance, is reportedly laying off 30% of its staff, which will affect close to 300 people. The company had previously announced in January that it would be laying off 3% of its workforce in an effort to improve team efficiency.
Additionally, it is said that the delivery company has raised $75 million through convertible notes. Google and Reliance, who are already investors, are contributing about $50 million of this $75 million, according to the report.
As late-stage startups continue to struggle with the so-called “funding winter,” Dunzo, which rivals companies like Blinkit and Zepto, has been attempting to cut costs.
In June 2022, the hyperlocal quick delivery startup lost money (EBITDA loss of over Rs 176 crore), while monthly expenses caused the company’s core business (Dunzo Daily) to lose money on each order it delivered during the first half of 2022, or H1 2022.
The company closed a few dark stores in Delhi-NCR and other areas in November 2022. Additionally, it had let go of 25% to 35% of the staff on its dark store teams. There are both contractual and payroll employees who are impacted.
In FY22, Dunzo’s operational revenue more than doubled to Rs 54.3 crore. But its losses increased 2X and reached Rs 460 crore. In order to increase 2X to Rs 532 crore and Rs 464 crore, respectively, in FY22, Dunzo’s annual expenditures, and losses closely followed revenue growth.
When it comes to ratios, EBITDA margin and ROCE are recorded at -645.64% and -31.95%, respectively. Dunzo’s operating expenses per unit were Rs 9.8 in the fiscal year that ended in March 2022.
