The layoffs impacted employees across teams, Dealshare cofounder Sourjyendu Medda told Inc42
The Tiger Global and Alpha Wave Global-backed startup is focusing on becoming profitable, Medda said
The unicorn has joined the list of Indian startups which have laid off employees since the start of 2022
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Ecommerce unicorn Dealshare has laid off 100 employees, or around 6% of its workforce of 1,500, in a bid to reduce its monthly burn rate and turn profitable.
With this, the grocery delivery unicorn has joined the growing list of Indian startups which have laid off employees since the start of 2022. The layoffs at DealShare come a year after the startup raised $210 Mn in funding over two rounds within a month in early 2022, resulting in its entry into the unicorn club.
Confirming the development, DealShare founder Sourjyendu Medda told Inc42, “We have removed the roles as a result of the current market conditions. We look at the business plan for the year and we have reduced the focus on some of the areas which would need very long-term capital infusion before becoming totally profitable. That has led to the [churn] of 6% of the organisation.”
Medda added that the startup’s decision to cut jobs to reduce its monthly burn impacted employees across teams.
The development was first reported by ET.
Medda told the publication that the grocery delivery unicorn’s burn rate has fallen to less than 40% from its peak and it has a cash runway of around four years.
“Given the massive market downturn that started early to mid last year, we had to rethink our business strategy and correspondingly make changes to our execution plan. From a strong focus on growth to achieve a large market share, we made substantial changes to our plans to focus on first driving profitability,” Medda was cited as saying in the report.
DealShare has reduced its focus on many initiatives and contained its geographical spread to cut costs. As such, the startup has paused operations in the bottom 20% of the 150 cities it operates in across the country.
Founded in September 2018 by Medda, Vineet Rao, Sankar Bora, and Rajat Shikhar, DealShare is a social ecommerce marketplace. It enables first-time internet users to shop online.
The startup sells grocery and household essential products through social media and messenger platforms like WhatsApp. DealShare has now started repositioning itself as a D2C ecommerce company offering a range of products to low-income consumers.
The layoffs at DealShare come after the startup reported a loss of INR 431 Cr in FY22, up 6.4X from INR 67 Cr in FY21. While its total revenue skyrocketed 8.2X to INR 1,933 Cr, expenses also increased 7.8X to INR 2,388 Cr in FY22.
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