Tencent-backed B2B ecommerce marketplace Udaan fires contract employees across cities

Tencent-backed B2B ecommerce marketplace Udaan fires contract employees across cities
Photo Credit: 123RF.com
27 Apr, 2020

Udaan, the B2B ecommerce platform that shot into the limelight when it crossed the $1 billion valuation market in record time, has terminated several thousand contractual employees across divisions of sales, marketing, business development, credit analysis team, customer services, at least two affected employees told TechCircle on Monday.

“On 24th of April, we were not able to mark attendance in the morning. We immediately intimated to our reporting managers. We were told it was due to some technical issue, they’re working on it and there’s nothing to worry about,” the former employee from Mysore, Karnataka said on the condition of anonymity.

However, in the afternoon of the same day, the employee and all his teammates in the district received a termination letter from the recruiting agencies that Udaan uses for its staffing requirements.

The recruiting agencies, the former employee said include Aasaanjobs, TeamLease, Avsar, Talent Lab, ALK Talent Search and Watermelon.

By his estimate, about 3,500 contractual employees have lost their jobs across the country.

Hiveloop Technology, the Bengaluru-based company that owns and operates Udaan, did not respond to TechCircle’s request for comment on the matter.

Read: Soaring valuations and Udaan’s bid to crack the B2B ecommerce code

Another affected employee in Bengaluru told TechCircle that although his termination letter too reasoned that the projects have shut down, he knew team mates who still continue to work in the same project.

The Bengaluru-based employee is part of a larger group that lodged a complaint with a local police station in Bengaluru. The police said that the matter would be forwarded to the labour commissioner in the city, the employee added.

The group of employees will speak to the area inspector later on Monday, he added. The same group of employees have also taken to microblogging platform Twitter to voice concerns about the massive layoffs. 

“Even in Oyo, they have let off thousands of employees, but they have given two months of salary as compensation. But here they are telling us that the contract has closed so you can’t work with us, go and search for a new job. We have been provided with one month of salary and three months of medical insurance,” the Mysore-based employee said.

“In the fresh foods and essentials category, the business is doing good in many locations, because they’re in B2B, it is not a loss. And they invested in PetPooja last February around Rs 14 crore, they have opened new warehouses in Delhi and Mysore but now there is no money to pay salaries,” the employee added.

Read: B2B ecommerce firm Udaan invests $1.9 mn in food-tech platform PetPooja

Udaan’s parent entity is currently the highest funded B2B ecommerce company in the country.

Last month, it reportedly raised $30 million from its Singapore-based parent entity Trustroot Internet, marking the total capital raised by the company at $900 million. In October it raised $585 million in a growth funding round from multiple investors including new investor Tencent Holdings.

In February, Udaan said its valuation has reached $7.5 billion based on projected cash flows and upcoming equity infusions.