BNPL startup Simpl lays off 30 more employees

Buy Now Pay Later (BNPL) startup Simpl has reportedly initiated a second round of layoffs, which will affect 30 employees. 

These cuts include mid-senior management across various departments. The development follows a significant layoff less than a month ago when the Bengaluru-based fintech startup laid off about 160 employees.

The recent layoffs are part of Simpl’s cost-cutting measures aimed at achieving profitability.

Layoffs amid a high monthly cash burn

The layoffs come amid a high monthly cash burn and a slowdown in new user acquisitions. According to media reports, the founder informed department heads about the decision on June 6, and the process started immediately.

Some senior management members were asked to resign rather than being directly laid off. 

“As an organization, we routinely review our businesses to improve efficiencies and become more agile and leaner to drive consistent growth. Over the last few years, we have scaled our business exponentially and to drive this growth in a sustainable manner, we have been undertaking a series of measures to improve operational efficiencies," said Ashish Kulshrestha, Head of Communications at Simpl.

How are the laid-off employees being compensated?

Simpl has assured that the laid-off employees will receive a fixed salary for a two-month notice period, along with additional compensation equivalent to 15 days of salary for each year of service. 

Founded in 2018, The startup currently has around 26,000 merchants on its platform, including Zomato, Makemytrip, Big Basket, 1MG, and Crocs. It offers BNPL as a checkout option and has introduced a pay-in-3 product for customers.

Is it profitable?

In FY23, Simpl saw its net loss increase by 147% to Rs 356.6 crore, despite an operating revenue surge of 176% to Rs 87.3 crore.

The startup had over-hired post-pandemic to expand its checkout network business into the direct-to-consumer (D2C) segment.

However, the business has remained stagnant since last year, leading to the recent layoffs. This is technically the third round of layoffs for Simpl, with a group of employees already let go in March and April after performance reviews, followed by over 160 employees in May.

Layoffs in other companies

The layoffs at Simpl are part of a larger trend of job cuts across various sectors in 2024. Major companies like Swiggy, Ola, Paytm, and Flipkart have all announced significant layoffs this year.

For example, Ola Cabs laid off about 200 employees in April, Byju’s laid off 500 employees, and Swiggy reduced its workforce by 400 employees.