Bengaluru-headquartered last-mile delivery startup has raised $75 million from returning investors in convertible notes, according to reports. The company also laid off 30% of staff on Wednesday after the CEO addressed the employees in a town hall.
The choice of convertible notes helps the company benchmark a valuation on the current business. Dunzo was valued at $757 million as on May 2022, according to data research platform Tracxn. It had last raised $240 million in equity funding in January 2022 led by Reliance Retail.
Business-to-business marketplace Udaan too raised $120 million in convertible notes in October 2022 from returning investors.
The Economic Times reported that $50 million of the funding will come from returning investors Google and Reliance Retail. The remaining will come from other investors on Dunzo’s captable, once Dunzo achieves necessary performance metrics. The company continues to hold talks with other investors, said the report.
On Wednesday, Co-founder and CEO Kabeer Biswas addressed the employees at the company, indicating a change in business model and the layoffs, which have impacted nearly 300 people. Earlier this year, Dunzo had laid-off 3% of its workforce but did not specify the number of employees affected.
Specific queries sent to Dunzo ahead of publishing the copy did not elicit a response.
The consumer-facing on-demand delivery service provider joined the quick commerce race with deliveries under 19 minutes called Dunzo Daily in 2021 as players like Zepto and Swiggy’s Instamart were flush with capital. As funding dried up and macro-economics changed, Dunzo shifted its focus from quick commerce to group deliveries by August 2022 and added business-to-business deliveries, including for its investor Reliance Retail.
