Swiggy – Laying off employees in the midst of a pandemic
Swiggy, the popular online food delivery company headquartered in Bengaluru, recently made headlines for all the wrong reasons – announcing layoffs of nearly 800 employees in the midst of the COVID-19 pandemic. This news sparked widespread outrage and concern over the company’s decision to let go of its staff members.
Company introduction and history:
Founded in 2014 by Sriharsha Majety, Nandan Reddy, and Rahul Jaimini, Swiggy has become a household name when it comes to food ordering and delivery in India. The company started with just a handful of employees and a small funding of $1.25 million, but quickly grew to become one of the most successful online food delivery companies in the country. With a total funding of $1.6 billion till date, Swiggy has managed to expand rapidly and capture a market share of over 60%.
Funding and investors:
Swiggy has had an incredible journey when it comes to funding and investors. Over the years, the company has raised money from some of the biggest names in the investment world, including Tencent Holdings, Naspers, DST Global, Meituan-Dianping, and Coatue Management. With its latest funding round in 2019, Swiggy’s valuation surged to $3.3 billion, making it one of the most valuable start-ups in India.
How Swiggy is performing:
Despite the intense competition in the food delivery industry, Swiggy has managed to maintain its dominance in the market. The company reported a gross revenue of Rs 1,300 crore ($172 million) in the year 2019, which was almost double the figure reported in the previous year. Swiggy also expanded its operations to over 500 cities in India and had a 45% market share as of December 2019. However, the COVID-19 pandemic has taken a toll on the company’s performance, with restaurants shutting down and people avoiding ordering food due to safety concerns.
Reason for the layoffs:
The COVID-19 pandemic has caused massive disruption in the food and beverage industry, with restaurants and cafes being forced to shut down due to lockdown restrictions. Swiggy, being an online food delivery company, was expected to do relatively well during the pandemic. However, the company was hit hard by the crisis, with many of its restaurant partners shutting down and the demand for food delivery services plummeting. As a result, Swiggy announced that it would be laying off nearly 800 of its employees in April 2020. The company said that the layoffs were necessary to ensure the survival of the business in the long run.
Number of employees laid off:
Nearly 800 employees of Swiggy, mostly from the cloud kitchen division, were laid off in April 2020. This was around 14% of the total workforce of the company.
Statement from company stakeholders on layoffs:
The decision to lay off employees was met with widespread criticism, with many people questioning the company’s decision. However, Swiggy’s co-founder and CEO, Sriharsha Majety, defended the move, saying that it was necessary to ensure the survival of the company. In a letter to the employees, he said, “This is easily the hardest and longest deliberated decision the management team and I have been faced with over recent times. We have been very fortunate to have a team that has trusted us and supported us through thick and thin. Unfortunately, we have to part ways with 1,100 of our employees.”
Conclusion
The decision by Swiggy to lay off nearly 800 employees in the midst of the COVID-19 pandemic has sparked widespread outrage and concern over the company’s actions. While the layoffs were necessary to ensure the survival of the business, they have raised questions about the company’s commitment to its employees. This incident serves as a reminder that businesses need to be more socially responsible and take care of their employees in times of crisis.
