Chennai-based WayCool Foods has reportedly let go of at least 70 employees over the past month, marking the second round of layoffs at the agritech startup within a year, according to sources.
According to sources, the recent round of layoffs affected employees across various departments, including sales, research, marketing, and technology.
They added that the startup, which includes subsidiaries like WayCool Censa and WayCool BrandNext, also closed down its warehouses over the last month.
The sources attributed the restructuring exercise to the startup’s inability to secure new funding rounds over the past two years.
In response to inquiries regarding the matter, a spokesperson from WayCool confirmed the layoffs but refrained from disclosing the number of employees affected by the restructuring.
“Over the past one year, WayCool foods has focused its investment behind its own brands, to capture the benefit of its efficient supply chain to the fullest. Our brands have achieved a significant scale. This enables us to build a direct, warehouse free supply chain from source to market. Hence, we have rationalised the warehouse footprint, resulting in some redundancies,” the spokesperson said in a statement.
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The spokesperson asserted that this transition has enabled the startup to decrease its EBITDA loss by more than 80%, positioning it to potentially achieve EBITDA profitability in Q1 FY25.
“Indeed, several of our business units are already EBITDA positive for several months . We are, as we speak, wrapping up another round of funding and will continue to raise capital as required by the business,” the statement added.
Last year, WayCool launched its FMCG entity BrandsNext, featuring brands like Madhuram, KITCHENji, DeziFresh, and Freshey’s.
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It’s noteworthy that WayCool implemented a restructuring exercise in July of last year, resulting in the layoff of approximately 300 employees as part of its effort to achieve profitability. While some employees chose to resign, others were requested to tender their resignations.
Last year, reports surfaced indicating that the agritech startup was negotiating to raise approximately $50 million to $70 million, valuing the company at around $900 million. However, it was unable to finalize this funding round due to the prevailing funding challenges. Consequently, WayCool had to reduce its expenses to prolong its operational runway.
WayCool has yet to submit its financial statements for FY23 to the Ministry of Corporate Affairs (MCA). According to reports, the company has reportedly slashed its expenses by 60% since October 2022 and aimed to conclude FY23 with a revenue of INR 1,700 crore.
In FY22, the startup experienced a staggering 142% year-on-year (YoY) increase in its net loss, reaching INR 360.5 crore. Meanwhile, operating revenue surged 2.4 times to INR 926.9 crore from INR 382.3 crore in FY21.
To date, WayCool has secured approximately $300 million in total funding, with support from investors including Lightrock, Lightbox, Lightsmith, 57 Stars, and FMO.
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