More trouble for Dunzo: Legal notices by Facebook, Nilenso over unpaid dues

Hours after Dunzo announced its plans for another round of layoffs, there is another issue hovering over the popular quick-commerce player.

According to a moneycontrol report, Dunzo has been served a legal notice by Facebook India Online Services Private Limited ("FBI") and Nilenso, a software consultancy firm, based out of Bengaluru, over non-payment of dues.

Report further adds that Dunzo has made part payments to Facebook but still owes about Rs 1.5 crore to the tech giant. Dunzo had availed Facebook’s advertising services but did not pay the entire amount for the same.

Not only Facebook, Nilenso, which provides software engineers on contract, has also sent a demand notice under the Insolvency and Bankruptcy Code (IBC) to Dunzo for the payment of outstanding dues.

The Bengaluru-based cooperative is still owed around ₹2.5 crore, after paying roughly ₹1 crore from its total outstanding.

These developments come at a time when Google, Dunzo’s second-largest backer, has also issued a legal notice to Dunzo asking the startup to clear unpaid dues.

Dunzo Layoff

In a bid to combat mounting financial troubles, Dunzo, the popular quick-commerce player, has announced plans for yet another round of layoffs, as revealed by the company's co-founder and CTO, Mukund Jha, during an all-hands meeting on July 19.

This will mark the third time within a span of seven months that the company has resorted to laying off employees to navigate its cashflow issues. The dire situation has put the startup's back against the wall, forcing it to take drastic measures.

According to estimations made by senior employees, the upcoming layoffs are expected to impact approximately 20% of Dunzo's workforce, equivalent to around 200 employees. Already, in two previous rounds of layoffs, the company had let go of 380 employees.