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As funding crunch persists for the start-up ecosystem amidst an uncertain macro environment, multiple start-ups have begun laying off employees. The latest to join the club are Google-backed social media platform ShareChat and quick commerce platform Dunzo.
Mohalla Tech, the parent company of social media platforms ShareChat and Moj, has laid off 20 per cent of its workforce, about 400 employees to “sustain through macro headwinds”. “Even as we continue to keep growing, there have been several external macro factors that impact the cost and availability of capital. Keeping these factors in mind, we need to prepare the company to sustain through these headwinds,” a spokesperson at ShareChat said underscoring the reason.
Sharechat’s parent Mohalla Tech had shut down its real money gaming platform Jeet11, resulting in a job loss for 5 per cent of its team earlier. The company had raised $520 million from Google and Temasek Holdings in June 2022 and was last valued at around $5 billion
Another Google-backed start-up to lay off employees is the quick-commerce platform Dunzo. The start-up has laid off 3 per cent of its workforce stating restructuring as the reason. According to the company’s LinkedIn profile, it has around 3,000 employees, thus affecting around 90 employees. “We are continuously looking at our team structures and network design to build efficiency into our teams. As we scale from 10 to 100, we are continuously learning how to redefine business processes at scale. Any decision that impacts people is tough, and always our last option. Last week, we had to part ways with 3 per cent of our team strength,” said Kabeer Biswas, CEO and Co-Founder, of Dunzo.
In January 2022, Dunzo raised $240 million in a funding round led by Reliance Retail and saw participation from Lightbox, Lightrock, 3L Capital, and Alteria Capital. Reportedly, the company was last valued at $800 million.
Growing list
Sharechat and Dunzo join the long bandwagon of start-ups that have announced layoffs in the last month. Amidst the funding winter, Ola laid off 200, LEAD laid off 60, Unacademy’s Relevel laid off 40, Cashfree Payments laid off 100, Moglix laid off 30, and Bounce laid off 90 employees in January. Funding in Indian start-ups dived 33 per cent y-o-y to $24 billion in 2022, according to a report by PWC India.
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