Zypp Electric Trims 10% Workforce Over 'Performance’ Issues

SUMMARY

Zypp Electric CEO Akash Gupta told Inc42 that the retrenchments were part of a “rationalisation” exercise aimed at driving efficiency, sustainable growth and profitability

Gupta also said that the company has downsized its workforce to 1,180 from 1,300 employees in January this year

Earlier, Zypp cofounder and CBO Rashi Agarwal told Inc42 that the startup will clock INR 1,000 Cr revenue in FY25 and achieve EBITDA profitability

IPO-bound electric mobility startup Zypp Electric has laid off nearly 10% of its workforce in the past three months due to “performance” issues.

Zypp cofounder and CEO Akash Gupta told Inc42 that the retrenchments were part of a “rationalisation” exercise aimed at driving efficiency, sustainable growth and profitability.

“As a company, we have not officially conducted any layoffs but, in fact, we did appraisals in the month of February. During appraisals, we have to look at some kind of rationalisation to keep driving efficiencies, to drive sustainable growth, and profitable growth… In January, we were at about 1,300 employees and now we are close to 1,180 or 1,190 odd people,” Gupta said.

The development was first reported by Livemint. The report said that the company downsized its workforce by more than 150 employees as part of an exercise to reach EBITDA profitability before the public listing.

It added that Zypp has introduced a “loss-of-pay policy” for team leads, under which the startup is handing out three-day targets to team leads. Failure to achieve goals under the new policy will result in loss of pay for one day, the report added.

However, Gupta rejected this and termed it “hogwash”.

Eye On Profitability Before IPO: The electric vehicle-as-a-service platform has lined up plans to list on the bourses by the end of 2026 and is pulling all stops to rein in its cash burn and losses. This is important as public market investors favour profitable companies.

Zypp cofounder and chief business officer (CBO) Rashi Agarwal told Inc42, earlier this month, that the startup will clock INR 1,000 Cr revenue in the ongoing fiscal year 2024-25 (FY25) and achieve EBITDA profitability.

In FY24, Zypp’s net loss zoomed 125% to INR 91.1 Cr from INR 40 Cr in the previous year. Operating revenue rose 168% to INR 292.7 Cr from INR 109.1 Cr in FY23.

Zypp Electric’s Funding Spree: To achieve its ambitious INR 1,000 Cr revenue target, the company has been aggressively raising funds to scale up its operations. In 2024, it raised $14 Mn in its ongoing Series C round led by Japanese energy solutions major ENEOS Corporation, taking its total fundraise to $55.5 Mn till date.

Not stopping there, it was also reported earlier this year that Zypp was planning to raise an additional $35 Mn in funding.

Founded in 2017 by Gupta and Agarwal, Zypp Electric provides electric scooters to local merchants and ecommerce companies for last-mile deliveries. It counts the likes of Swiggy, Zepto, Flipkart, Rapido, Blinkit, Zomato, Uber, and Amazon among its clients.

Overall, the electric mobility startup operates a fleet of over 22,000 electric scooters across key cities like Delhi-NCR, Mumbai, and Bengaluru. The startup, which is backed by Indian Angel Network, Venture Catalysts, 100Unicorns, Gogoro, among others, competes with the likes of MoEving, Baaz Bikes, and Yulu across various segments.