Sequoia Capital-backed Nearbuy, formerly known as Groupon India, is currently going through a rough patch. With depleting bank balance and non favourable business conditions, two of the co-founders have already taken the exit path, now the company is also cutting down on its workforce. The company has decided to layoff 10% of its currenct workforce.
Co-founders, Sachin Kapur and Ankur Sarawagi, from the company took an exit some time back. The two had joined the deals and coupons bandwagon after its initial traction among consumers, and are now likely to settle back and move on to a consulting role for the time being. There has also been a bunch of other senior-level executives exits from the company due to rapid decline in coupon business.
Commenting on the sacking of a chunk of its employees, Ankur Warikoo, CEO of Gurgaon-based company says,
“Headcount has been reduced from 431 to 383. All except 17 departures were on the basis of the annual appraisal results that we conduct every year in February and March. The 17 departures were because we reconsidered entering into food delivery and closed down our products business, a legacy from Groupon – admittedly we went into a cash conservation mode because of the changed funding environment. No raises were given and spending on non-people elements was controlled.”
Nearbuy, formerly known as Groupon India, was previously a subsidiary of the Chicago-based coupon and deals entity Groupon. Sequoia Capital invested USD 100 million into the venture last year, to help it break away from the parent. The investment firm now holds a large stake in the company alongwith Groupon who still holds a majority stake. But the India coupon industry has see a significant slowdown in recent past. Because of this the deal amd coupon companies are now finding it difficult to rope in big brands and convince them to provide offers on its platform.
On his exit from the company, co-founder Sachin Kapur said:
“Yes, I am taking a break. I have some personal projects in mind that I have been trying to work on but I will still be involved with Nearbuy. Post the re-branding to Nearbuy we have pivoted (change of business model) to being a largely local commerce player. There has been an overall slowdown in the market and we are not insulated from that.”