Reliance Industries-backed Dunzo, a quick commerce platform that has been grappling with financial challenges, has reported a substantial loss of Rs 1,800 crore for the fiscal year 2023.
However, the company's operational revenue increased significantly to Rs 226 crore, a more than fourfold increase from Rs 54 crore in the last fiscal year.
The report comes at a time when Dunzo has been navigating through turbulent times, marked by the exit of top-level executives, including co-founders and the finance head.
Operational hurdles have also been evident with delays in salary payments and a series of mass layoffs.
Last month, Dalvir Suri announced its departure from Dunzo, following which the startup said it would undergo an organisation-wide restructuring from this quarter.
Despite these challenges, Dunzo managed to raise $240 million in a funding round led by Reliance at the end of FY22.
Dunzo's revenue gains were eclipsed by a fourfold rise in expenses, including a 2.7 times hike in runner contact fees, contributing to its losses.
Employee benefits and ESOP costs, along with heavy advertising and dark store investments, including IPL campaigns, pushed advertising expenses to Rs 310 crore, adding to the financial strain in FY23.
Amidst financial strain, Dunzo is actively seeking fresh funding, although this comes with the challenge of potentially reduced valuation, with reports suggesting a decrease from $800 million to $200 million.
Currently, Mukesh Ambani's Reliance holds a 25.8% stake, while Google has around 19%.
In 2021, Dunzo raised $40 million in its Series E funding round led by tech giant Google, Lightbox, Evolvence, Hana Financial Investment, LGT Lightstone Aspada, and Alteria, among others.