Quick commerce startup Dunzo, backed by Reliance Retail, has secured $75 million (₹614.13 crore) in funding through convertible notes, per sources quoted by the Economic Times.
What Happened? According to ET sources, Google and Reliance Retail are investing $50 million (₹409.40 crore), while existing investors are putting in the remaining amount.
In a convertible note, the investor lends money to a startup, which will be converted into equity, usually in conjunction with a future financing round. Instead of receiving a return in the form of principal plus interest, the investor will receive equity in the company.
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Dunzo is also said to be in talks with Abu Dhabi Investment Authority (ADIA) for additional funding, but the capital may only come after the business has stabilised and specific metrics have been met.
Workforce slash: In a town hall meeting on Wednesday, Dunzo CEO Kabeer Biswas informed employees about job cuts and a shift in the business model and strategy. The hyperlocal delivery startup plans to lay off over 300 employees, which is about 30% of its workforce.
Dunzo competes with several other delivery startups, such as Swiggy's Instamart, Zepto, BigBasket, and BlinkIt, all of which are attempting to grab a share of India's growing retail market — a market that is expected to surpass $800 billion (₹65,50,234.80 crore) by 2025 according to brokerage firm Bernstein’s estimates.
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