After Dunzo co-founders, Lightrock India partner, Reliance Retail nominees resign from board: Report

Reliance Industries-backed quick commerce startup Dunzo has seen a spate of high-profile exits in the last two months. On Monday, it was reported that co-founder Dalvir Suri exited the company.

Following this, another co-founder Mukund Jha reportedly left the cash-strapped platform, which has been struggling with funding shortfall, delayed payments to employees and layoffs. In the last two months, five top executives have reportedly quit the company board.

The first two resignations came on August 3, when Ashwin Khasgiwala, group chief of business operations at Reliance Retail, and Rajendra Kamath, finance head at Reliance Retail, left the Dunzo board. Reliance Retail is the largest shareholder in Dunzo with a stake of nearly 26 per cent.

On August 21, Vaidehi Ravindran, a partner at Lightrock India, exited the board. Lightrock owns 8.6 per cent of Dunzo, according to Tracxn, a data platform that tracks privately held startups. On August 29, cofounder Dalvir Suri left the board. On September 1, Jha reportedly left the company. Though the company has confirmed Suri's exit, Jha's departure is yet to be confirmed.

“The exits are linked to Dunzo’s cash-flow issues and the legal notices sent to the company for pending dues. The personal liabilities were becoming quite big for the directors,” a company source quoted by the Economic Times said.

The official added that the board members may return after a planned funding round is closed and the pending dues have been cleared.

Since 2015, Dunzo has raised close to $500 million from Reliance, Google, Lightrock, Lightbox, Blume Ventures and several others. Reliance is the largest shareholder with a 25.8 per cent stake in the company, according to Tracxn.

In a statement, co-founder and CEO Kabeer Biswas said: “Dalvir has been instrumental in building out every new line of business at Dunzo. He has been the key zero to one person from the founding team who just gets things Dun. He has been meaning to take a break for some time now — and with over six years spent building Dunzo, he plans to move forward to pursuing new journeys.”

He added, "We are making some org-wide changes in restructuring our business starting this quarter, and the DMS business (Dunzo Merchant Services: B2B vertical) has very capable leadership that's picking up directly after him."

Though Jha’s next move is not clear yet, company insiders told Moneycontrol that he has stepped down from daily operations and a formal announcement could come in the following weeks.

A company spokesperson said: “Mukund remains an integral part of Dunzo’s leadership team. While we are restructuring the organisation, with new leaders driving key mandates, Mukund will continue to be an important part of the strategic leadership team, guiding and directing Dunzo’s future roadmap.”

As of now, only CEO Biswas, Siddharth Talwar from Lightbox and Hongjim Kim from STIC Investments are on the company board.
 
Among the co-founders, only Biswas owns about 3.6 per cent of Dunzo. Jha and Suri, another co-founder Ankur Aggarwal have no ownership in Dunzo.
 
The three of them reportedly drew salaries and had employee stock ownership plans (ESOPs), like other employees, which Dunzo has delayed several times in the past.

Delay in salaries

Dunzo has reportedly told its former employees that they will have to wait till February 2024 to get their pending salaries. The employees, who have parted ways with Dunzo will only receive their full and final (F&F) for four more months, Moneycontrol reported.

In the past, the startup has set new timelines but has missed all of them on multiple occasions. Initially, it said all dues would be cleared on July 20. But failed to do so.

"We are working towards ensuring all pending salaries are paid at the earliest. However, we regret to inform you that given the present business situation, the revised timelines by which we will clear pending dues, including salaries for the months of June and July, if any, in January - February 2024," Dunzo told former employees in an email.  

"Additionally, all other remaining payments, which include August/September salary for days served will be paid out by January-February 2024 as part of your F&F," the email further said.

Also read: Dunzo co-founder Dalvir Suri departs amid company-wide restructuring

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