Dunzo delays salary further, opts for batch payments amid fundraising challenges

“Due to certain procedural requirements, we have to do this batch-wise,” Dunzo stated in an email to employees as reported by Moneycontol. 

The company had initially promised to disburse August salaries to its current employees starting on September 4. However, it has now informed its workforce that these payments will be made in batches due to “certain procedural requirements,” which may take an additional day or two to complete.

Moneycontol reported that the email further stated, “Team members whose salary has been processed will receive an email confirmation. Rest assured you will receive your August 2023 salary within this week without fail.”

The company has postponed salaries to the first week of October due to certain procedural requirements. In an email to employees, Dunzo assured that August 2023 salaries would be paid within the week and apologised for the delay. 

The startup had previously committed to an interest payment of 12 percent per annum on the salary component withheld since June. Reports suggest Dunzo was in advanced talks to secure $80-100 million in a series G funding round from existing investors including Lightbox and Lightrock.

Dunzo’s financial challenges have reached a critical point, with the company facing legal notices from more than seven companies and vendors, totaling over ₹11 crore in claims. In response to these financial pressures, Dunzo has resorted to three rounds of layoffs over the past year, resulting in the reduction of over 500 jobs. These measures have been taken as cost-cutting measures while awaiting the influx of funds.

Since its inception in 2015, Dunzo has managed to secure approximately $500 million in funding from notable investors such as Reliance, Google, Lightrock, Lightbox, Blume Ventures, and others. Reliance holds the largest stake in the company, with a substantial 25.8 percent ownership, while Google is the second-largest shareholder with around 19 percent ownership, as reported by Tracxn, a private markets data provider.

Updated: 05 Sep 2023, 02:53 PM IST