Bengaluru-based quick commerce and last-mile logistics company has announced that it will further defer the payment of outstanding salaries for its employees for the months of June and July. In an email to its employees on Wednesday evening, the company said that all employees will be paid the full salary for the month of August on September 4, 2023.
In July, Dunzo had promised to pay 12% annual interest on the salary amount held back for June and July to the affected employees. The interest will be cleared at the earliest, along with the balance payable, said the company in the email, stating that it will announce the exact date of payment next week.
A copy of the mail was seen by YourStory.
As Dunzo struggled to raise a fresh round of funding, the quick commerce company had capped salary payouts for the months of June and July at Rs 75,000. Around 15%-20% of its employee base was impacted, mostly from the leadership team.
In its latest email to employees, Dunzo said that it was on the path to close a new round of funding. According to recent media reports, the startup is in talks with existing investors to raise around $20 million in a new round, however, there have been disagreements on the valuation being sought.
The company was valued at $757 million as of May 2022, according to data and market research platform Tracxn. Reliance Retail is the largest shareholder in the company with nearly 25.56% stake, followed by Google which holds 18.53% of shares in the company. Dunzo had last raised $75 million in convertible notes from returning investors Reliance and Google in April 2023.
“We sincerely apologise for this delay. Ensuring that our team members receive their due compensation is a top priority for us and we are doing everything to make this happen. We have made positive progress on funding and we aim to close procedural requirements in September,” said the email.
It further added that the company will hold a townhall next week to address questions from employees and give updates on fundraise and other business developments.
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Recently, some of Dunzo’s partner dark stores, which serve the company’s core quick-commerce business Dunzo Daily, had stopped work due to non-payment of salaries. The operations resumed last week as the company paid the off-roll workers their pending salaries.
Dunzo Daily constitutes nearly 90% of the company’s revenues. The company has shut down its dark store network and is increasingly relying on partner stores to continue to fulfil the quick-commerce orders.
The quick commerce space now also has a new unicorn. Zepto raised $200 million in a new round, making it the first company in 2023 to cross $1 billion in valuation as it targets EBITDA breakeven in the next 12-15 months. Swiggy’s Instamart, too, is focused on improving its profit metrics as the food delivery major is targeting a public issue in 2024.
Edited by Kanishk Singh
