As fears of recession loom large over the world, in India, the startup winter continues with Swiggy announcing the latest round of layoffs. The delivery app announced that it is firing nearly 3% of its 6,000-strong workforce. As part of it, 380 employees are being laid off.
The decision was announced on January 20 by Swiggy founder and CEO Sriharsha Majety.
We're implementing a very difficult decision to reduce the size of our team as a part of a restructuring exercise. In this process, we will be bidding goodbye to 380 talented Swiggsters.
- Sriharsha Majety in email to employees
Why is Swiggy firing employees?
Our overhiring is a case of poor judgment, and I should've done better here.
- Swiggy also stated that it will be shutting its meat marketplace as they haven't hit product-market fit despite its estimations. But they will continue to offer meat delivery through Instamart.
- The layoffs come at a time when the company is preparing to become profitable before going for an IPO.
What will the affected employees get?
- Affected employees have been assured a minimum severance package of 3 months, medical insurance till May 31, 2023, and office laptops to look for jobs.
- A severance package can be given for 6 months based on the tenure and grade of the employee.
Background: Swiggy raised $700 million in its last funding round in January 2022 and is valued at $10.7 billion.
- From Byju's, Ola, Unacademy and Meesho in India, to Microsoft, Salesforce and Amazon worldwide, layoffs are hanging over the heads of several people as the pandemic-induced bubble of e-commerce bursts.
- According to Moneycontrol, over 1,000 people have been laid off by Indian startups in 2023 and at least 20,000 were laid off since 2022.