Hyper local Startup PepperTap Shuts down Operations, 150 Staffers Laid Off

by April 25, 2016 0 comments
Image courtesy of PepperTap

NEW DELHI, INDIA: Hyper-local grocery delivery startup PepperTap is going to shut down its operations to focus on expanding its logistics business.

Speaking on this move PepperTap CEO Navneet Singh said the company was “losing cash on every order” and has decided to “preserve a large amount of the investor capital” than “be at the bottom of the abyss”.

Issues like high customer acquisition costs and poor app integration with partner stores are the main reason for the closure. 150 staffers will be losing their job following this move.

Controlled by Nuvo Logistics, PepperTap has raised USD 40 million so far with investments from Snapdeal, Sequoia India, SAIF Partners, Beenext, Ru-Net, and JAFCO Asia.

2015 was a watershed year for India, with over $9 billion risk capital invested in Indian startups. This gold rush to invest in the tech startups was highly euphoric, but half-baked business models and no real innovation brought down many over-enthusiastic startups.

Online grocery business in India has become increasingly challenging with Localbanya and Townrush closing their operations. Major e-commerce players like Paytm and Flipkart also launched on-demand grocery verticals but have pulled the plug on their operations. Softbank-backed Grofers also backed out from nine cities in January this year to conserve cash and keep tab on burn rate.

Launched in November 2014 by Navneet and Millind Sharma, PepperTap had previously closed operations in six cities including Mumbai, Kolkata and Chennai.

 

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