Dunzo App, Website Down After Co-Founder Kabeer Biswas Exits - Is It The End Of Dunzo?

Dunzo, once a name in India’s hyperlocal delivery space, appears to have halted its operations, with both its app and website becoming non-functional. Users attempting to access its website encounter a generic error message, while the app fails to load updates, signalling an abrupt operational breakdown.

Founded as a promising player in the quick-commerce segment, Dunzo has faced mounting financial and operational struggles over the past two years.

The startup, backed by major investors like Reliance Retail (26% stake) and Google (20% stake), had achieved a valuation of $744 million in 2023. Despite raising $449 million in equity funding, it was unable to sustain its position in the competitive market.

Leadership exodus and investor backing

A series of exits by its top leadership further compounded Dunzo’s challenges. Co-founder Kabeer Biswas is reported to have joined Flipkart to head its 10-minute delivery initiative, Flipkart Minutes, following the departure of co-founders Mukund Jha, Dalvir Suri, and Ankur Agarwal.

Dunzo’s financial strain was evident in its widening losses, which ballooned from Rs 464 crore in FY22 to a staggering Rs 1,801 crore in FY23. Struggles with cash burn and difficulty securing additional growth capital forced the company to downsize operations and workforce over the last two years.

Mounting competition and employee issues

The quick-commerce sector saw fierce competition from players like Swiggy Instamart, Blinkit, and Zepto, which aggressively expanded their services.

Dunzo, however, struggled to keep pace, grappling with high operational costs and dwindling market share.

Employee dissatisfaction added to the turmoil, with reports of unpaid salaries prompting complaints. In a bid to sustain itself, the company reportedly sought acquisition opportunities with Reliance Retail and Flipkart but failed to secure a deal.

A fall from grace

Once a leader in the hyperlocal delivery market, Dunzo’s decline highlights the challenges of the quick-commerce space, where balancing growth aspirations with profitability remains a significant hurdle. As of now, the company’s services appear to have come to a standstill, marking a somber chapter in India’s startup ecosystem.