Vidit Aatrey, Founder and CEO, Meesho
| Photograph Credit score: The Hindu
E-commerce agency Meesho has laid off 251 workers constituting 15% of its workforce to chop prices and as a part of its efforts to realize profitability, a prime firm official stated on Friday, Might 5, 2023.
Meesho Founder and CEO Vidit Aatrey in an e mail to workers knowledgeable in regards to the choice and introduced that each one the affected workers will get one month additional severance pay past the discover interval in addition to worker inventory possession plan (ESOPs) no matter the interval they’ve been with the corporate.
“We’re lowering the scale of the Meesho workforce by 15%, affecting 251 workers,” Mr. Aatrey stated in an inner e mail.
He stated that the corporate grew 10 occasions from 2020 to 2022 which was aided by COVID tailwinds and aggressive investments.
“At the same time as we tracked our plans, the macro local weather undeniably and significantly modified. Consequently, we’ve needed to speed up our timeline to profitability as a part of Challenge Redbull, whereas readjusting our GMV progress targets to 30% YoY.”
“Whereas our money reserves buffer us properly for these harsh circumstances, we have to keep extremely prudent on the price entrance,” Mr. Aatrey stated.
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A latest report by Jefferies had stated that Meesho is already contribution-margin optimistic (pre-marketing and oblique spends) and the corporate is nearing zero money burn and is on observe to realize Earnings Earlier than Curiosity, Taxes, Depreciation, and Amortisation (EBITDA) breakeven this yr.
When contacted, the corporate spokesperson stated: “We now have taken a troublesome choice to half methods with 251 Meeshoites constituting 15% of the worker base, as we glance to work with a leaner organisational construction to realize sustained profitability.” The spokesperson stated that the corporate is dedicated to make sure all these impacted have its full assist and shall be supplied a separation bundle that features a one-time severance cost of two.5 to 9 months (relying on tenor and designation), continued insurance coverage advantages, job placement assist and accelerated vesting of ESOPs.
“We stay grateful for his or her contributions in constructing Meesho,” the spokesperson stated.