TinyOwl lays off 112 more, to scale down operations
TinyOwl Technology Pvt Ltd is laying off 112 more employees in its second such move in two months, as the food-tech startup tries to make its business viable.
The company said in a statement on Tuesday it will scale down its operations nationally as a step towards sustainability and growth "in the current challenging market scenario".
Separately, TinyOwl CEO Harshvardhan Mandad said in a blog post the company will scale back operational resources back from four cities and will move to the e-sales platform to support customer needs and supply and logistics requirements.
The Economic Times first reported the development. The report said the latest staff cuts will be in marketing, sales and human resources teams in Delhi, Hyderabad, Chennai and Pune. TinyOwl expects its total employee count to drop from around 1,000 earlier this year to around 650, it said.
Queries sent by Techcircle.in to TinyOwl in this regard went unanswered by the time of filing this report.
The company statement said TinyOwl will continue to operate in six cities and that the new model will be initially tested in Mumbai and Bangalore. It didn't elaborate.
The move comes just days after the company raised $7.5 million (Rs 50 crore) in fresh funding from existing investors Sequoia Capital and Matrix Partners.
In September, Techcircle.in had reported that TinyOwl had shown the door to about 100 staffers.
TinyOwl was founded in 2014 by Mandad, Shikhar Paliwal, Gaurav Choudhary, Saurabh Goyal and Khandelwal, all of whom are IIT Bombay alumni. The mobile-first venture had raised $15 million (Rs 93 crore) in Series B funding led by Matrix Partners early this year. Existing investors Sequoia Capital and Nexus Venture Partners also participated in that round.
The online food ordering business in India is estimated to be worth around Rs 5,000-6,000 crore, growing at about 30 per cent month-on-month, according to a report by India Brand Equity Foundation. However, this segment is transaction-driven and margins can be wafer thin.
It has been a year of mixed fortunes for the food-tech startups. A few startups have shut shop or have downsized operations.
TapCibo Online Solutions Pvt Ltd, which operated under the brand Dazo, closed operations earlier this month.
Cash-strapped SpoonJoy, backed by Flipkart co-founder Sachin Bansal, shut shop in Delhi and parts of Bangalore. Recently, the Spoonjoy team was inducted by hyper-local grocery and fresh food delivery startup Grofers as part of an acqui-hire deal.
Foodpanda is revoking over 500 restaurants every month as it deals with allegations of operational irregularities. And two weeks ago, restaurant listing and services company Zomato said it was laying off around 300 employees worldwide, or nearly 10 per cent of its workforce.
Yet, the sector continues to sustain investor interest. A couple of days earlier, Gurgaon-based Twigly, a food-tech startup that delivers meals from its centralised kitchen, raised $200,000 in angel funding from SAIF Partners' Mukul Singhal, InMobi's Amit Gupta and other investors.
Recently, Techcircle.in reported that MealHopper secured $100,000 in seed funding from ixigo.com co-founders Alok Bajpai and Rajnish Kumar. Earlier, gourmet meals portal iChef.in raised an undisclosed amount from Springboard Ventures, an investment arm of media house Times Group's holding company Bennett, Coleman & Co Ltd. Also, on-demand meal service startup Frsh.com recently raised under $1 million in a bridge round of funding from Mumbai Angels, Roposo co-founder Mayank Bhangdia and existing investor Kae Capital.