Buy Now Pay Later (BNPL) fintech Simpl has laid off around 160-170 of its staff across departments and roles, especially those in higher-paying functions like engineering and product. This comes even as the fintech's monthly cash burn has remained elevated and new user acquisitions have slowed down, according to people aware of the developments.
"Founder and CEO Nityanand Sharma had a brief all-hands townhall with employees today at 9 am. It seemed he was reading out of a prepared script. He said we are sorry to let go people and will do our best to help with stuff like outplacement," said a source in the know.
Simpl had around 650 staff till yesterday, including those in core operations, interns, and calling agents. The layoff has impacted round 25 percent of the company's workforce across these domains. Some of those who have been laid off have already started posting for jobs on LinkedIn.
Additionally, the layoff has impacted Simpl's D2C checkout vertical.
Sources aware of the developments also told Moneycontrol that the lay offs were part of the startup's cost-cutting measures to work towards profitability.
"People are very agitated because this is the time when everyone was expecting appraisals. Also note that a bunch of employees were already let go in March end and April beginning after performance reviews. This layoff of at least 100 people is excluding that," he added.
A second source pointed out that this is the second round of layoffs for the second consecutive year, as around 160-170 employees were let go around March 2023 as well.
"At that time, the company had said that there won't be any more layoffs. However, between then and now they hired a lot of people, perhaps in the range of 50-100. In effect, quite a few people who were laid off today were new in the company. Some of them might have spent only 1-1.5 months," he added.
Simpl said that the firm has undertaken layoffs to improve operational efficiency.
"As an organisation committed to creating a shared value for our merchants, and millions of customers across the country, we have undertaken a series of measures to improve operational efficiencies, reduce fixed and overhead costs, along with taking the difficult decision of letting go of some of our talented employees. These efforts are enabling us to accelerate our journey towards profitability and build a fiscally prudent organisation," Ashish Kulshrestha, Head of Corporate Communications, Simpl told in response to Moneycontrol's queries.
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 Bill Box.
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.
Updated the layoff number from 'at least 100' to 'around 16o-170' in light of new information from sources.
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