Rupeek has laid off around 50 employees as part of its plans to turn profitable in the next 12-18 months
In June this year, the startup laid off around 180 employees, taking the number of employees sacked this year to 230
Rupeek is also in final stages of discussions to raise $16 Mn in funding from Sequoia Capital, Accel, Bertelsmann, ZNL Growth Fund, among others
Gold loan provider Rupeek laid off around 50 employees across departments on Wednesday (September 7) as part of its plans to turn profitable in the next 12-18 months.
This is the second round of layoffs at the Bengaluru-based startup. In June this year, it laid off around 180 employees.
People aware of the development told Inc42 that the startup’s management informed the employees about its decision to cut workforce on Wednesday.
In a statement, the fintech startup confirmed the development with Inc42.
“Taking cognizance of the subdued macroeconomic situation, we accelerated our efforts over the past few months to achieve profitability. As further clarity emerged, we have firmed up our strategy to turn profitable in the next 12-18 months and adapt to the quickly evolving market conditions,” the statement said.
“A transition towards a leaner cost structure combined with the recent closure of fundraises as per plan will ensure we are well capitalized in the above journey. This strategic step mandates us to restructure our workforce to unlock better synergies, and as a result of that, with deep regret and much deliberation, we had to part ways with ~5% of our total workforce,” Rupeek added.
Rupeek has parted ways with around 230 employees in 2022 so far. A company spokesperson had cited “subdued macroeconomic environment” as the reason behind the layoffs in June.
The latest development comes a day after Inc42 exclusively reported that the startup is in the final stages of discussions to raise a funding of $16 Mn. Rupeek is raising the new funding round from its existing investors such as Sequoia Capital, Accel, Bertelmann, ZNL Growth Fund, among others, sources said.
The startup has already received $7.4 Mn of funding in the round.
In an internal note shared by Rupeek founder Sumit Mariyar and accessed by Inc42, he said, “At the outset, despite the slowdown of funding in the startup ecosystem, we were able to close our fundraises as planned. This strengthens our foundation and keeps the business well capitalized.”
“Over the next few months, we will focus on strengthening our core business. In addition to this, a transition towards a leaner cost structure combined with the recent closure of fundraises, and bolstering of our lender portfolio will ensure we are well placed to achieve profitability. However, this strategic transition mandates us to restructure our workforce to unlock better synergies, and as a result of that, with deep regret and much deliberation, we will have to part ways with ~5% of our total workforce,” he added.
In January this year, Rupeek raised $34 Mn in funding led by Lightbox, GGV Capital, and Bertelsmann at a valuation of about $630 Mn. The startup then said that the funding would help it reach over 120 cities. As per its website, the startup is currently operational in more than 60 cities across 5,000 locations.
Founded in 2015 by Maniyar and Ashwin Soni, Rupeek provides instant gold loans at doorstep and through bank branches. As per its website, the startup’s lending partners include Federal Bank, ICICI Bank, Karur Vysya Bank, South Indian Bank, Credit Saison and Rupeek Capital.
Rupeek reported narrowing of its loss to INR 156 Cr in FY21 from INR 487 Cr in FY20, while its total revenue grew to INR 88.5 Cr from INR 31.9 Cr in FY20. Its expenses dropped to INR 245 Cr in FY21 from INR 519 Cr in FY20.
As per Inc42’s layoff tracker, Indian startups have laid off around 12,078 employees (including Rupeek) in 2022 so far.