A grocery bag with the logo of the American delivery startup Gopuff.
Delivery startup Gopuff is cutting 10% of its workforce globally and closing 76 warehouses in the U.S., investors said in a letter.
The letter says the layoffs will affect about 1,500 employees, who will be notified within Tuesday. The company is also closing 76 warehouses, about 12% of its network, in the US while expanding services at other more efficient facilities.
“As part of our efforts to reduce overheads and increase operational efficiency, we have made the incredibly difficult decision to reduce our global workforce by 10%,” the letter says. “While challenging, it restructures us to focus more closely on business priorities, accelerating our path to profitability.”
The current cuts are an attempt to help the company become profitable by 2024, the letter to investors said.
Gopuff also said it will focus on improving its core business of instant delivery and increasing international investment, especially in the UK.
“These shifts not only accelerate our timeline to achieve profitability, they take us back to our roots of keeping profitability at the heart of every decision,” the letter says. “We remain committed to our ambition to build a business for generations and are more confident than ever in Gopuff’s performance and ability to capitalize on the moment before us.”
Gopuff was valued at $15 billion last year. The company reportedly considered a public listing in 2022, but has since shelved those plans due to a broader slowdown in market debuts.
First reported about it bloomberg.
Gopuff is one of the so-called fast shipping companies that often promise orders to be delivered to your door in 30 minutes or less. Such firms are heavily subsidized by venture capitalists. But there seems to be a dramatic shift in the fast-shipping segment in recent months as venture capitalists move away from growth model at any cost who once contributed to the development of companies such as Uber.