Chennai-based startup WayCool Foods has laid off over 200 employees after failing to secure funds. The Agritech startup laid off over 300 employees last July and 70 staff members in February this year.
“Salaries have been delayed in the past, and the company is yet to process the June payslip. Funding has dried up, and the payments from clients are stuck,” Moneycontrol reports.
The situation worsened after WayCool failed to pay dues to vendors, including millers, and logistics partners. Also, vendor payments have completely stopped since June due to delayed client collections.
Moneycontrol tried to get clarity from the startup.
"Each of WayCool's businesses is working towards profitability. Roles and structures are being simplified and automated as part of this ongoing process," the company told the news portal.
The funding freeze has affected employees across Chennai, Bengaluru and Hyderabad, and its subsidiaries -- CensaNext and BrandNext. Waycool has been trying to raise funding from existing investors since November last year.
On that note, the company said it has secured 75% of the capital from its ongoing bridge round of $40 million. It will complete the fundraising by August, which it believes will provide a sufficient runway to reach cash profitability.
Per the research portal, The Kredible, The company's revenue from operations grew by 62% to Rs 1,251 crore in FY23 from Rs 772 crore in FY22, but costs remained high, leading to an 89 % increase in losses to Rs 685 crore.
Internet Reaction:
Internet users are reacting negatively to the news.
One user wrote, "hahahaha!!! waycool was doing hanky panky. agri sector mein kya hai.. perishable goods. cash intensive."
Another user commented, "Why recruit in the first place if they can't run a business, with Angel tax now abolished expect more startups to open overnight and layoffs to happen during day time. This is a sham and a scam!"
A third user replied, "More layoffs expected"
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