Bengaluru, 09 February 2024: Blissclub, a Bengaluru-based fashion apparel startup, recently underwent a restructuring exercise resulting in the layoff of around 21 employees, constituting approximately 18% of its workforce. However, insiders suggest the actual number of impacted employees may be as high as 30.
Founder’s Announcement and Layoff Process:
During a town hall on January 11, Blissclub’s founder and CEO, Minu Margeret, informed employees about the decision to streamline operations. The affected employees were promptly notified about the layoffs in follow-up meetings with their respective team heads. The restructuring exercise affected various teams, including sales, marketing, growth, and product, with the creative team being notably dissolved.
Impacted employees were given the option to resign voluntarily or face termination. Blissclub is reportedly providing a two-month salary as a severance package to the affected workforce. Despite attempts to seek clarification, queries sent to Minu Margeret regarding the development remained unanswered as of the time of reporting.
The primary motivation behind the layoffs was attributed to Blissclub’s challenges in securing fresh capital amidst a high cash burn rate. The startup had last raised $15 million in its Series A funding round from Eight Road Ventures and Elevation Capital in May 2022.
Blissclub Background and Financial Performance:
Established in 2020, Blissclub initially operated as an online platform specializing in activewear products for women. Over time, it diversified its product offerings and expanded its presence with the addition of offline stores. However, recent financial figures indicate a surge in net losses, which escalated by 305.6% to INR 35.7 Crores in the financial year 2022-23, compared to INR 8.89 Crores in the previous fiscal year. Operating revenue experienced a substantial increase of 361.4% to INR 68.3 Crores from INR 14.8 Crores in FY22. Concurrently, total expenditure witnessed a growth of 354% to INR 107.8 Crores from INR 23.7 Crores in FY22.
Blissclub’s recent layoffs place it among the increasing number of Indian startups resorting to restructuring initiatives to manage costs in the face of funding challenges since the onset of the funding winter in 2022. According to Inc42’s layoff tracker, Indian startups have collectively laid off over 34.7 thousand employees since the beginning of 2022.
