Zerodhas Nikhil Kamath-backed Third Wave Coffee lays off 120 employees after raising $35M

Zerodha co-founder Nikhil Kamath-backed Third Wave Coffee, a specialty coffee and food brand, said it has laid off employees following a strategic review with the aim of consolidating teams for increased efficiency.

While the company didn't disclose the number of laid-off employees, A Moneycontrol report claimed that the startup has laid off around 120 employees. The layoffs have impacted various departments, including technology, finance, marketing, business development, and app development.

Layoffs after $35M fundraising 

The layoffs come just months after Third Wave Coffee raised $35 million in a Series C funding round led by Creaegis, with participation from existing investors. 

The latest move has surprised many, as the company had been on an expansion trajectory. The startup, however, asserts that this is a one-time restructuring exercise, impacting less than 10% of the organization.

“As an organisation we are in a strong position post the recent fund raise,” the company said in a statement. It didn’t disclose the number of workers who have been laid off.

What about the laid-off employees?

According to the company's statement, the laid-off employees have been offered two months' salary if they choose to leave immediately or the option to work until mid-February 2024. Reports indicate that there was no prior written communication about the layoffs, with the process being conducted in person by the head of HR and the founder.

“The head of HR and the founder have come to each of us, speaking for 10–15 minutes and informing people that their roles are no longer needed in the restructured organisation,” an employee was quoted by Moneycontrol.

The company plans to continue scaling and building as India’s most loved coffee brand. The layoffs are seen as a strategic move to maintain a leaner organization and control costs in a challenging macroeconomic environment.

What does Third Wave Coffee do?

Founded in 2017 by Ayush Bathwal, Anirudh Sharma, and Sushant Goel, Third Wave Coffee said that it has rapidly expanded its footprint, operating over 100 stores across major Indian cities as the country's coffee and food sector flourishes. 

The brand claims that it is operating a network of over 100 cafes in cities, including Bangalore, Mumbai, Delhi, and Pune. 

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