Swiggy has will not only let go of 380 staff but has also closed its meat marketplace.
Foodtech company Swiggy has fired 380 employees in a bid to rationalise business amid a tough venture funding market, a company spokesperson said on January 20, the latest in the series of layoffs that have rocked India’s startup ecosystem.
The decision, which affects around 3 percent of its 6,000-strong staff, was communicated to employees at a town hall on January 20.
“We’re implementing a very difficult decision to reduce the size of our team as a part of a restructuring exercise. In this process, we will be bidding goodbye to 380 talented Swiggsters. This has been an extremely difficult decision taken after exploring all available options and I’m extremely sorry to all of you for having to go through with this,” Swiggy founder and CEO Sriharsha Majety said in an email to employees after the town hall.
Majety said that the company would have to take a harder look at some of its existing verticals and would be shutting down its meat marketplace.
“While the team has done exceptionally well with solid inputs, we haven’t hit product market fit here despite our iterations. From a customer perspective, we will still continue to offer meat delivery through Instamart. We will continue to stay invested in all other new verticals,” he added.
The employees who have been fired will receive a cash payout of three to six months of salary, based on their tenure and grade. This includes a 100 percent payout of variable pay/ incentives. The joining bonus and retention bonus paid out will be waived.
The annual vesting cliff for employee stock options has been waived as well for the affected staff. “We will be extending vesting to the nearest quarter from the last working date. They will also be eligible to participate in the ESOP liquidity programme slated for July 2023,” the company said.
The SoftBank-backed company had raised $700 million in its last funding round in January 2022 at a valuation of $10.7 billion.
No signs of a thaw
As reported by Moneycontrol, Swiggy’s listed rival Zomato laid off 100 employees in November, as it looks to cut costs and turn profitable. The company plans to trim the workforce by 4 percent, sources told Moneycontrol.
A few days ago, ShareChat parent Mohalla Tech Pvt fired 600 of its 2,100 employees, joining a growing list of unicorns to have laid off employees in large numbers. Byju’s has let go 2,500, Ola 2,100, Unacademy 1,190, Vedantu 1,109, Udaan 530 and Meesho 450 in recent weeks.
According to data compiled by Moneycontrol, Indian startups have already laid off more than 1,000 employees in 2023 and at least 20,000 employees since the start of 2022.