MUMBAI: SoftBank-backed e-commerce firm Meesho laid off 251 employees, 15% of its workforce to cut costs and as part of its efforts to achieve profitability. The Bengaluru-headquartered start-up had over 1,800 employees before the layoffs were announced. Meesho founder and CEO Vidit Aatrey in an email to employees informed about the decision and announced that all the affected employees will get one month extra severance pay beyond the notice period as well as employee stock ownership plan (ESOPs), irrespective of the period they have been with the company.
“We are reducing size of the workforce by 15%, affecting 251 employees,” Aatrey said in an internal email. He said the firm grew 10 times from 2020 to 2022, which was aided by COVID tailwinds and aggressive investments.
“Even as we tracked our plans, the macro climate considerably changed. As a result, we have had to accelerate our timeline to profitability as part of Project Redbull, while readjusting our GMV growth goals to 30% YoY,” he said. “While our cash reserves buffer us well for these harsh circumstances, we need to stay prudent on cost front,” Aatrey added. A recent Jefferies report had said Meesho is already contribution-margin positive and it is nearing zero cash burn and is on track to achieve EBITDA breakeven this year.