Gorillas to lay off 300 employees & exit 4 markets to boost profitability
Category: #retail  By Pankaj Singh  Date: 2022-05-25
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Gorillas to lay off 300 employees & exit 4 markets to boost profitability

Berlin-based Gorillas has reportedly laid off 300 employees and is exiting four markets-Spain, Italy, Belgium, and Denmark-as the company looks to shift from hyper-growth to clear profitability.

The company will now focus on its home region of Germany along with the Netherlands, France, the United States, and the United Kingdom, which collectively hold 90 percent of its existing revenue.

The lay-offs will primarily be of its Berlin headquarter staff which represents half of the company’s employees. Many of the employees joined the organization barely six months ago, making it easier to lay them off under German labor laws.

Gorillas currently have close to 700,000 active customers. This announcement comes following the company’s fund-raising reports. But Gorillas struggled to close its round given the existing condition of the venture market.

Experts mentioned that the company has USD 300 million in the bank. But it ran into trouble owing to substantial outstanding debts towards suppliers and others. The company has been functioning on a monthly burn rate between USD 50 million and USD 75 million.

The tech world has been witnessing a significant drop in technology finance. Many startups are striving to close funding rounds, market caps are getting slashed, and companies are implementing layoffs, hiring freezes, and cutting additional costs to conserve cash.

Interestingly, the instant grocery market has been over-inflated for a long time and required urgent correction. Many startups in this field were over-funded, with investors and founders seeking to gain momentum from the opportunity generated due to changed consumer habits during the pandemic.

While some companies have fallen astray, others have closed operations whereas a small group of companies continued to raise funds. For instance, Zapp secured USD 200 million in January, and Flink announced additional funding a week ago amid its Cajoo acquisition.

Source credit:

https://techcrunch.com/2022/05/24/berlins-gorillas-lays-off-300-explores-strategic-options-in-4-countries-as-funds-dry-up-for-its-3b-instant-grocery-play/



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Pankaj Singh

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Pankaj Singh

Pankaj Singh Develops content for Market Size Forecasters, Algosonline, and a couple of other platforms. A Post Graduate in Management by qualification, he worked as an underwriter in the UK insurance domain before deciding to switch his field of profession. With exp...

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