Food and grocery delivery giant Swiggy might slash 8-10 per cent of its workforce amid the funding slowdown within the start-up ecosystem.
According to a report by Financial Express, the layoffs also come at a time when the company is aiming to turn operationally profitable before its upcoming initial public offering (IPO). The layoffs will majorly impact employees in product, engineering and operations, the sources added.
In addition, the foodtech unicorn recently concluded its performance review in October, and several employees were also put under a performance improvement plan (PIP), sources told FE.
Apparently, Swiggy has a numbered rating system for all employees on a scale of 0-5. Employees with a rating of two and below have received intimation about PIP and they are the ones who will most likely be impacted.
Last month, Swiggy had told Business Today that layoffs are not on the cards but performance-based exits can be expected. “There have been no layoffs at Swiggy. We concluded our performance cycle in October and have announced ratings and promotions at all levels. As with every cycle, we expect exits based on performance,” the statement by Swiggy stated.
Delay in IPO?
The news report also revealed that the company’s management had delayed filing preliminary papers for IPO to market watchdog, Securities and Exchange Board of India (SEBI) due to the poor performance of tech stocks in India and abroad.
“The management has decided to take a wait-and-watch mode, and has now pushed the draft filing for its IPO to December 2023,” a source said. Another one said, “The work pressure has increased sharply over the past six months or so and the company has been shuffling teams for a while now…Employees are now just being asked to chase numbers and hit positive unit economics before the (public) listing,”
Bundl Technologies, the parent company of Swiggy, saw its losses widen by two times from Rs 1,616 crore FY21 to Rs 3,628 crore in FY22, according to the company’s financials which released recently. The increase in losses comes against the backdrop of its expenses also expanding exponentially from Rs 4,292 crore to Rs 9,748 crore in the last one year.
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