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Layoffs · Commerce & Consumer Brands

Swiggy lays off 350 employees as business struggles post-pandemic

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Date
Company
Swiggy
What it does
food delivery service
Kind
Layoffs
Sector
Commerce & Consumer Brands

What they do

Swiggy is a food delivery service that connects customers with restaurants and delivers meals

What happened

Swiggy laid off 350 employees across operations, marketing, cloud kitchens, and product teams in July 2020

Why it matters

The company said the layoffs were to control costs and extend its financial runway as daily orders dropped to under 6 lakh from 15 lakh before the pandemic

The details

  • Swiggy, a food delivery company, laid off around 350 employees in July 2020 as part of cost-cutting measures.
  • The layoffs affected teams in operations, marketing, cloud kitchens, and product development.
  • Swiggy said the move was to control expenses and stretch its financial runway amid a drop in daily orders.
  • Daily orders had fallen to under 6 lakh from around 15 lakh before the pandemic, according to sources.
  • The company had previously laid off 1,100 employees and scaled back its cloud kitchen operations in May 2020.
  • Swiggy is providing severance packages, including 3 to 8 months of salary, accelerated ESOP vesting, and health insurance for affected employees.

The bigger picture

  • The food delivery industry was severely impacted by the pandemic, with many customers cooking at home instead of ordering online.
  • Swiggy and its rival Zomato had recovered only 35-40% of their pre-pandemic order volumes by July 2020.
  • The company is trying to maintain customer confidence by displaying safety measures such as staff and delivery executive temperatures.
  • Swiggy has expanded into grocery delivery and alcohol delivery in certain states to diversify its offerings.

About the business

  • Swiggy is a food delivery service that connects customers with restaurants and delivers meals.
  • The company also offers grocery delivery through its Swiggy Stores service, which operates in 125 cities.
  • Swiggy has expanded into alcohol delivery in states like West Bengal, Odisha, and Jharkhand.
  • The company has experimented with DIY food kits to adapt to changing consumer preferences.
  • Swiggy has raised $158 million in funding in 2020, including a $113.3 million Series I round led by Naspers and a $43 million investment from Tencent.

What happens next

  • Swiggy is focusing on maintaining customer confidence through transparency about safety measures.
  • The company is expanding into grocery delivery and alcohol delivery in select states.
  • Swiggy is experimenting with DIY food kits to adapt to changing consumer behavior.

The deal

Type
layoff

Investors

  • Naspers (lead) — A South African multinational internet group that led a $113.3 million Series I round in 2020.
  • Tencent (participated) — A Chinese multinational technology company that invested $43 million in Swiggy in April 2020.

Founders

  • Rahul Bhandary, co-founder and CEO
  • Naveen Tewari, co-founder and CTO

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