1K Kirana, Gurugram-based Kirana tech startup, lays off 40% of its workforce as it struggles to raise fresh funds

• ByStartupStory     |    April 4, 2023

1K Kirana, a Kirana tech startup based in Gurugram, has let go of 40% of its employees as part of its restructuring efforts and the shutdown of certain regional operations. According to reports, the company’s inability to secure new funding has led to the job cuts, with investors placing a greater emphasis on profitability and financial performance.

On-the-ground operations, warehouse, delivery, network operations, growth, and tech teams have all been affected by the layoffs, according to a Moneycontrol report.

At the start of April, the startup had 1,052 employees, according to its LinkedIn profile. The sources were cited as saying that there are only about 200 employees total across all teams. The latest round of staff terminations at 1K Kirana occurred at the end of March, having started in November of last year.

According to the startup, at least 400 employees have been let go. Moneycontrol was informed by numerous sources with knowledge of the situation that the figure was at least 600 employees, or more than 60% of the workforce.

In a statement shared with Inc42, 1K Kirana cofounder Kumar Sangeetesh said, “We are currently in the process of restructuring as our growth forecasts have changed. We are changing our focus areas and moving out of a few geographies. Due to this, we have to let go of 40% of our employees. All the employees will be given severances and we will assist them with outplacements.”

 

1K Kirana was founded in 2018 by Sangeetesh, Sachin Sharma, and Abhishek Halder. It utilizes a franchise model to connect Tier-II consumers with kirana stores, with a D Mart-style business model that allows customers to shop and check out via its app. The startup claims that 70% of its franchise partners are existing kirana stores, while the remaining 30% are new entrants.

In May 2022, 1K Kirana raised $25 million in a Series B round led by Alpha Wave Global, Info Edge Ventures, and Kae Capital, bringing its total funding to $33.5 million across three rounds. However, the company has had to let go of 40% of its workforce due to failed fundraising attempts and investor focus on profitability.

Unfortunately, this is not an isolated incident, as India’s startup ecosystem has seen over 80 startups lay off almost 24,000 employees since the beginning of 2022, according to Inc42’s ‘Indian Startup Layoff Tracker.’

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