Meesho fires 300 employees to cut losses

The latest: The Bengaluru-established startup is at crossroads presently as the terms it has received from investors for the new round of funding range between $4.5 billion to $4.9 billion, demanding anonymity as the affair is private.

Why it matters: Meesho reached $4.9 billion valuation in Sept and is spending $40 million every month to add new clients and scale its business. Highly unlikely to sustain this cost without raising new capital.

• The startup has shut Superstore operations in more than 90% of the cities it operated in, which led to many employees losing their job. Meesho registered a loss of Rs. 498.6 Cr In FY21.

Roadblocks: The startup said it was streamlining its grocery business to enhance efficiencies. “As we look to boost efficiencies in the light of the integration, a small number of full-time roles and certain third-party positions on six-month contracts at Meesho Superstore were reassessed to remove redundancies with the core business,”

• Change in strategy, high cash burn, no profit in sight, and intensified competition from big players—Flipkart and Amazon—Meesho, which is in the market to raise funds, is struggling to answer tough questions from investors.