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Reliance-backed Dunzo Faces Legal Notices from Vendors Amid Funding Crunch

The Busy Brains

25 Jul 2023

Dunzo, the delivery startup backed by Reliance, is grappling with a funding crunch and legal notices from multiple vendors, demanding the settlement of pending dues. The startup has deferred salaries, implemented a salary cap, and initiated layoffs in an effort to manage cashflows efficiently.

Reliance-backed delivery startup Dunzo is facing a challenging financial situation, with vendors sending a series of legal notices demanding payment for pending dues, according to a Moneycontrol report. The startup has been hit with legal notices from seven different entities, including Google India, Nilenso, Clover Ventures, Facebook India Online Services Private Limited (FBI), Cupshup, Koo, and Glance since March this year.

The total dues owed to these vendors have reached approximately Rs 11.4 crore, almost double the initial estimate of Rs 5-6 crore. The recent addition to the claims came from agritech startup Clover Ventures, which issued a legal notice to Dunzo demanding the settlement of dues amounting to over Rs 2 crore.

Amid the funding crunch, Dunzo has deferred the salaries of its workforce and set a salary cap of Rs 75,000 per employee from June. The company also initiated its third round of layoffs as part of its efforts to manage cashflows effectively. These measures come as the startup faces increasing financial pressure and seeks to navigate through these challenging times.

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