Swiggy plans to lay off 380 jobs and shut down its meat marketplace as the Prosus Venture and SoftBank-backed Indian food delivery giant looks to navigate the market downturn that has forced firms to become leaner and more disciplined.
In an email to employees on Friday, Swiggy co-founder and chief executive Sriharsha Majety said the startup has advanced its plans for profitability and needs to make difficult decisions to conserve cash. The Bengaluru-headquartered startup, which was valued at $10.7 billion in a funding round in January last year, employs about 6,000 individuals.
“Over the last year, we’ve also identified many areas for improvement in our pace of execution. Due to the iterative build-up of the different orgs, there have been some extra layers created in pockets. This definitely increased our communication overhead, and compromised our agility. This meant that instead of doing more with less, we were doing less with more in these cases,” he wrote in an email, seen by TechCrunch.
Majety said the startup plans to also shut down its meat marketplace “effective very soon.”
“While we continue to be fully committed to exploring new business opportunities, we have also taken a harder look at some of our existing new verticals. Effective very soon, we will be shutting down our Meat marketplace. While the team has done exceptionally well with solid inputs, we haven’t hit product market fit here despite our iterations. From a customer perspective, we will still continue to offer meat delivery through Instamart. We will continue to stay invested in all other new verticals.”
The impacted employees will be paid a severance of three to six months and additional days based on each year of service at the startup, Majety said in the email. Swiggy will also accelerate their vesting cliff and is providing medical insurance for them and their dependents until May this year.
Job cuts, in full swing last year, have bled into 2023. Scores of startups including Ola, Byju’s, Unacademy, Cashfree, CoinDCX, Dunzo, and ShareChat have laid off staff in recent months. According to industry estimates, more than 20,000 people in the startup workforce in India have lost their jobs since the market downturn.
(More to follow)