Indian delivery platform Dunzo secures $75m funding, to lay off 30% staff in business revamp
- ByStartupStory | April 6, 2023
Dunzo, the popular Indian online delivery platform, has secured $75 million in funding through convertible notes, as it plans to revamp its business model. However, the company is also set to lay off over 300 employees, which is around 30% of its workforce. The move is part of a strategic shift announced by founder and CEO Kabeer Biswas during a town hall meeting on Wednesday.
According to reports, key backers Alphabet Inc and Reliance Retail contributed around $50 million of the funding, with other existing investors providing the rest. However, Dunzo, Google, and Reliance Retail have not yet commented on the matter.
Under the new business model, Dunzo will reduce about 50% of its dark stores and only run those that are profitable or approaching profitability. The company plans to partner with supermarkets and other merchants to drive growth.
During the town hall meeting, Biswas reportedly told employees that the company had to make this decision to ensure profitability within the next 18 months. The move comes as the demand for super-fast delivery of household goods intensifies, and players battle to ensure that users receive their orders in 15 minutes or less.
Dunzo is also in talks with other investors, such as the Abu Dhabi Investment Authority (ADIA), but funding from these sources may only come after the business has stabilized and certain metrics are met.
Dunzo’s recent funding round and business model revamp are signs of the company’s determination to remain competitive in the fast-growing Indian delivery market. It remains to be seen how successful the company’s new strategy will be, but investors and customers alike will be watching closely to see how it develops in the coming months.
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