SINGAPORE (THE BUSINESS TIMES) – Fashion tech platform Zilingo has laid off 11 employees in Singapore as part of a 12 per cent global cut to its staffing, and put its Singapore office up for rent.
The start-up, which is backed by investors such as Temasek Holdings, EDBI and Sequoia Capital, had made under 5 per cent of its 796-strong workforce redundant in April, The Business Times reported then. EBDI is the corporate investment arm of Singapore’s Economic Development Board.
About 35 employees in Singapore were affected in the first wave; the second wave of 11 were told to go at the end of June, sources told BT.
The company provides software to help merchants sell online and help players in the supply chain to digitalise. It was last valued at US$963.3 million, said VentureCap Insights.
But the effects of the pandemic has hit it hard, with over a quarter of South and South-east Asian fashion micro-SMEs (small and medium-sized enterprises) shutting their businesses. Such companies are Zilingo’s main clients.
The leadership team of Zilingo, which is headquartered in Singapore, has taken a pay cut of at least 30 per cent, co-founders Ankiti Bose and Dhruv Kapoor said in a message to employees.
Sources told BT that the company had listed its 7,000-square-feet Duo Tower office on online platform CommercialGuru at a negotiable rate of $84,000 per month. This translates to $12 per sq ft.
The listing was posted on Thursday and the property was described as immediately available, but the post has since been taken down. Zilingo’s registered address with the Accounting and Corporate Regulatory Authority (Acra) is a building at 20 Bendemeer Road, located in an industrial area.
Ms Bose and Mr Kapoor said that due to the pandemic, teams will be working from home full-time or part-time, and the company will let go of or sublet some of its office spaces.
The current Singapore office will be fully functional from August, they said. While it remains the global headquarters, the founders said a few positions have been relocated to other offices in Philippines, Thailand, India and Indonesia to focus on local geographies.
All non-compete clauses have been waived for laid-off employees and employee stock ownership plans will continue to vest throughout the notice period. Cliffs have been waived without conditions.
Zilingo said it has created a roster with the details of affected staff, with their consent, to help them with finding new jobs.
“While we have been so focused on expanding margins, it is equally important for us to cut down costs to ensure long-term profitability, in times when it is hard to predict the future. We believe a global economic recovery will take a year or more – we must be prepared to stay on course and ready for what the market demands,” said the founders.
Separately, Zilingo’s chief financial officer James Perry, a veteran banker who joined the start-up last year after 22 years at Citi, has sold back his shares to the company for a nominal sum of US$1, regulatory filings showed.
When queried, a spokesperson for Zilingo said that Mr Perry and all other senior leadership are “very much still” with the company. “The ACRA filing reflects an internal restructure of shares to be in compliance with applicable regulations,” she said.