Lightbox, a key investor in the cash-strapped hyperlocal delivery platform Dunzo, has given up its board seat, people aware of the developments have told Moneycontrol.
With an 11.1 percent stake, Lightbox is the single largest shareholder in the company after Reliance Retail (25.8 percent) and Google India (19.3 percent). Lightbox’s move effectively means that Dunzo does not have any of its primary investors sitting on its board now.
The board exits began in 2023. Between August and October last year, representatives from Reliance Retail and Lightrock stepped down from the board. At the same time, Dunzo co-founders Dalvir Suri and Mukund Jha also gave up their board seats and left the company, as reported by Moneycontrol.
The string of exits happened at a time when the hyperlocal player was battling for survival after a rough year. Since April 2023, Dunzo has defaulted on salary payments, missed multiple vendor deadlines and has been served legal notice by stakeholders among several hurdles.
In the process, Dunzo lost the confidence of most of its board members. At one point, around mid 2022 — when Dunzo was at its peak — the company had eight board members but after the recent move, the strength is down to two, filings with the Ministry of Corporate Affairs (MCA) showed.
Kabeer Biswas, co-founder and CEO, and Hongjim Kim from STIC Investments are the only two who remain on the of Dunzo board.
Siddharth Talwar represented Lightbox on Dunzo’s board but he decided to move on from the VC fund in August 2023. Lightbox recently decided not to nominate another person, Moneycontrol has learnt.
Lightbox declined to comment while an email to Dunzo remained unanswered.
Dunzo's woes deepen at a time when its peers — Blinkit, Swiggy Instamart and Zepto — are all making headway and giving larger e-commerce companies like Amazon and Flipkart a run for their money.
For companies, the quick commerce sector has gone from good-to-have-to an indispensable one in just over three years. That explains why other players, like Uber for instance, are also vying for an entry into the space, eating into the share of incumbents.
75 percent complete
The developments came at a time when Dunzo is trying to raise $25-30 million from a clutch of investors, as Moneycontrol reported in September. While the talks appeared to have fizzled out, media reports suggested Dunzo is still in the process of raising money.
In an email to former colleagues on May 19, CEO Biswas said the company was making “steady progress through a transaction that will allow (it) to tackle all of (its) liabilities together.”
While the email did not talk about the nature of the transaction, it said, “We are about ∼75 percent done with the process and hope to complete the rest of it in the next few weeks.”
Moneycontrol has reviewed a copy of the email.
Dunzo, however, has missed several such deadlines in the past and multiple former employees expressed disappointment at the same. In the email, Biswas apologised for having pushed out several such timelines and said things were looking better.
Founded in 2014, Dunzo has, so far, raised close to $500 million from Reliance Retail, Google India, Lightrock, Lightbox, Blume Ventures and several other marquee investors, according to Tracxn, a private markets information provider.
Disclaimer: Moneycontrol is a part of the Network18 group. Network18 is controlled by Independent Media Trust, of which Reliance Industries is the sole beneficiary.
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