BNPL startup Simpl hit by second round of layoffs, cuts 50 more jobs

Buy Now Pay Later (BNPL) startup Simpl has initiated a second round of layoffs, impacting approximately 50 employees, including mid-senior management across various departments, people aware of the matter told Moneycontrol.

The move comes less than a month after the Bengaluru-based fintech firm let go of about 160 employees, primarily in high-paying roles like engineering and product, as the monthly cash burn remains elevated while new user acquisitions slow down.

Meanwhile, four Vice Presidents (VPs) Ashwini Ravindranath,  Vatsal Jain, Ramkumar Narayanan, and Anoop Saurabh have tendered their resignations, two sources confirmed.

A person familiar with the matter said the founder informed department heads about the decision during a call on June 6, and the exercise has begun today.

The ongoing layoffs are part of the startup's cost-cutting measures to work towards profitability, as previously reported.

In a written response to Moneycontrol, the company confirmed the development around layoffs, but clarified that it is not 50 people but 30 resources who are subject to it.

It, however, declined to comment on changes in the senior management.

“As an organisation, we routinely review our businesses to improve efficiencies and become more agile and leaner to drive consistent growth. Over the last few years, we have scaled our business exponentially and in order to drive this growth in a sustainable manner, we have been undertaking a series of measures to improve operational efficiencies," said Ashish Kulshrestha, Head of Communications, Simpl.

The employees who are laid off will receive a fixed salary for a two-month notice period, and additional compensation equivalent to 15 days of salary for each year of service.

In FY23, Simpl saw its net loss spike by 147 percent to Rs 356.6 crore, even as the operating revenue surge by 176 percent to Rs 87.3 crore.

"They (Simpl) had over-hired post pandemic to expand their checkout network business into D2C segment. However, the business has been stagnant since last year," a mid-senior executive said.

"This is technically their third round of layoffs, as a group of employees were already let go at the end of March and the beginning of April after performance reviews, followed by over 160 employees in May," he added.

The developments come at a time when India's BNPL credit startups have come under pressure due to the Reserve Bank of India's tight scrutiny.

In fact, BNPL startup ZestMoney shut down its operations in December of 2023  amid regulatory uncertainty and a failed attempt to revive its business under a new management. The firm had also let go of around 150 employees.

Simpl, founded in 2016, has  around 26,000 merchants on its platform including Zomato, Makemytrip, Big Basket, 1MG and Crocs.

The company approaches BNPL as one of the checkout options with an idea to give its partner merchants the option to extend a pay later mode to customers. Additionally, the company introduced a product that allows customers to pay their bills in three tranches, called pay-in-3.

In 2021, Simpl announced a $40 million Series B fundraise led by Valar Ventures & IA Ventures - four years after its Series A round in 2017.

(The story was updated to include Simpl's statement on the development)