Cash-Strapped Dunzo Receives Legal Notices From 7 Companies Over Pending Dues

Struggling quick-commerce startup Dunzo has reportedly received legal notices from at least seven companies, including Google and Facebook, over pending dues.

Dunzo had received legal notices from Google India, Nilenso, Clover Ventures, Facebook India Online Services Private Limited (FBI), Cupshup, Koo and Glance, Moneycontrol reported.

Currently, Dunzo’s outstanding dues to these vendors stand at around INR 11.4 Cr.

In its notice sent on July 19, agritech startup Clover Ventures asked Dunzo to clear pending dues of INR 2 Cr, as per the report. 

Meanwhile, advertising company Cupshup said in its demand notice, “…My client would also prefer an amicable settlement over bitter litigation but my client is also apprehensive about the financial health of Dunzo as a going concern.” 

“The outstanding amount is substantial and owing to the delay in payments, my client has suffered severe financial hardships…My client is also responsible for the livelihood of its employees and hence cannot keep waiting for the payments,” the notice added.

Lock-screen platform Glance, which runs ads for companies on the lock screens of phones, sent a notice demanding Dunzo to pay INR 58 lakh for the services it availed.

“…Please note the unless we are receipt of the amount due within the aforesaid period, we reserve the right to commence legal proceedings at your cost and peril to recover the debt without further notice to you and this notice may be tendered in court…as evidence of your failure to pay amount due,” Glance’s notice to Dunzo said, as per the report.

Dunzo has also failed to refund the security deposit of over INR 62 Lakh to microblogging website Koo which subleased an office space from the quick commerce startup and vacated the same earlier this year.

The development comes at a time when Dunzo, once a leading player in India’s quick-commerce space, is struggling to raise fresh funds.

Earlier this month, the startup, which earlier deferred salaries of its employees, decided to postpone the payments once again. As per an internal email sent to employees, Dunzo would now pay the remaining portion of June salaries of its employees, which was earlier expected to be credited by July 20, in early September.

Amid these problems, several employees of the startup started tendering their resignations. Meanwhile, Dunzo is also likely to lay off about 200 employees.

Dunzo, which competes with the likes of Swiggy Instamart, Zepto, and Zomato-owned Blinkit, is reportedly seeking at least $20 Mn more cash injection from Reliance Retail, its largest shareholder.