New Delhi: Swiggy on Friday said it had laid off 380 employees from its workforce of 6000, citing challenging macroeconomic conditions and slowdown in growth of its food delivery business.
“This has been an extremely difficult decision taken after exploring all available options, and I’m extremely sorry to all of you for having to go through with this,” Sriharsha Majety, Swiggy’s CEO, wrote in an email sent to employees. “Our over-hiring is a case of poor judgment, and I should’ve done better here.”
Swiggy, which plans an initial public offering (IPO), is the latest start-up to lay off employees as funding slows down.
“We’re no exception here, and have already advanced our own timelines for profitability on food delivery and Instamart,” Majety said in the email that the company made public. “While our cash reserves allow us to be fundamentally well positioned to weather harsh circumstances, we cannot make this a crutch and must continue identifying efficiencies to secure our long-term.”
Majety said the food delivery business had grown slower compared to projections, forcing the company to “revisit our overall indirect costs to hit our profitability goals.”
“While we’d already initiated actions on other indirect costs like infrastructure, office/facilities, etc, we needed to right-size our overall personnel costs also in line with the projections for the future,” he said.
Workers laid off will receive a cash payout of three to six months of salary, based on tenure and grade. This includes 100 per cent payout of variable pay / incentives. Further, the joining bonus and retention bonus paid out will be waived off.
“The annual vesting cliff has been waived off. We will be extending vesting to the nearest quarter from the last working date. They will also be eligible to participate in the ESOP liquidity program slated for July 2023,” Majety wrote.