SUMMARY
The development comes almost two months after DealShare cofounder and CEO Vineet Rao stepped down from his role
DealShare said it is moving its operations to Gurugram and consolidating its business to focus on Jaipur, Delhi NCR, Lucknow and Kolkata markets
In FY22, the startup’s net loss ballooned 543% to INR 431 Cr from INR 67 Cr in FY21
Bengaluru-based social commerce startup dealshare
has decided to discontinue its B2B business and fired over 100 employees this month as part of this process, sources told Inc42.
The Tiger Global-backed unicorn confirmed the development to Inc42. DealShare said it is moving its operations to Gurugram and consolidating its business to focus on Jaipur, Delhi NCR, Lucknow and Kolkata markets.
“We also took a conscious decision to focus on B2C business at this point to stay relevant to our consumers in the market. We have taken decisions of realigning our budgets, reorganising teams and locations etc.,” a company spokesperson said in a statement.
Without giving any numbers, the statement said that the reorganisation resulted in some of the employees leaving the startup. As per a report by Moneycontrol, around 130 employees were affected by the restructuring exercise.
The development comes almost two months after DealShare cofounder and CEO Vineet Rao stepped down from his role.
Back then, the startup said Rao would support its board to help identify the new CEO. However, it didn’t disclose the reason behind his resignation. As such, Rao’s decision to abruptly step down without securing a replacement raised many questions.
DealShare, which has been facing a severe cash crunch, has made a series of new appointments in the recent months.
In July, it appointed former Tata Cliq CTO Saurabh Kishore as its CTO. Before this, Dealshare didn’t have a CTO and the company’s cofounder Rajat Shikhar used to take care of the job functions of the CTO.
The latest layoff round is the second such exercise by the company this year. Earlier in 2023, it laid off around 100 employees, or around 6% of its workforce, to reduce its burn rate and attain profitability.
Last month, Inc42 highlighted how B2B wholesale distribution is a difficult nut to crack and the five-year-old startup has been facing stiff competition from FMCG giants.
Besides, DealShare has also been grappling with increasing losses. In FY22, the startup’s net loss ballooned 543% to INR 431 Cr from INR 67 Cr in FY21. Though operating revenue surged over 8X to INR 1,932.8 Cr in FY22 from INR 236.7 Cr in FY21, the startup’s razor-thin margins forced it to shut operations in Maharashtra in June this year. Prior to that, the company also shut operations in Hyderabad, as per Inc42 sources.
Founded in September 2018 by Sourjyendu Medda, Rao, Sankar Bora, and Shikhar and Rishav Dev, DealShare entered the coveted unicorn club early last year after it raised $165 Mn from Dragoneer Investments Group and Unilever Ventures. It raised another $45 Mn in the next month in its Series E funding round from Abu Dhabi Investment Authority (ADIA).
