The impact of coronavirus is already been felt across the entire Indian startup ecosystem. From bootstrapped startups to deep pocketed unicorn startups, the industry is resorting to mass lay-offs to help them cope with tough times. Now joining this long drawn list is B2B e-commerce startup Udaan.
According to reports, Udaan has furloughed nearly 1000 contract staff to preserve capital. These contract employees mainly include delivery executives and the sales employees. The company has, however, not handed pink slips to any of its pay roll employees.
There is no confirmation on whether the company plans to slash the salaries of its pay roll employees. Techpluto will reach to Udaan regarding this and update our readers once we’ve confirmation about this matter.
Following this mass layoff, Udaan has joined other illustrious unicorn startups that have taken similar steps; these unicorn startups include Swiggy, Paytm and Oyo. By the way, Udaan holds the special status in the unicorn world, since it is fastest Indian startup to achieve the unicorn tag.
The Bengaluru based company breached the $1 Bn valuation mark within two years of its inception. It is essentially a B2B marketplace that helps small and medium businesses to buy, sell and even avail business loans.
Given that MSME sector has been hard hit by the ongoing nationwide lockdown, Udaan’s decision to scale down its business comes across hardly surprising. Unlike big corporates and MNCs, MSMEs don’t have the capital cushion to weather the rough storm.
Interestingly, Udaan had recently secured an internal funding of $30 Mn from its Singapore based parent company. It had even bagged a massive funding of $585 million in October last year at an impressive valuation of $2.8 billion.
Like several well-known startups, Udaan’s genesis are connected with Indian startup industry’s poster boy Flipkart. All its three co-founders Sujeet Kumar, Amod Malviya and Vaibhav Gupta were former senior executives at Flipkart.