Meesho Achieves Profitability with Support from Meta Investors
Meesho, with the aid of cost reductions such as recent job cuts, has managed to achieve profitability, making it one of the rare successful startups in India’s emerging e-commerce sector.
The Bengaluru-based online mall, which sells everything from clothes to jewelry and electronics, turned a small profit in July, said its chief financial officer Dhiresh Bansal. The company, whose backers include SoftBank Group Corp., Prosus NV and Meta Platforms Inc., had revenue of $406 million in the six months to June, Bansal said.
In order to break even, the startup laid off around 250 employees in May and cut spending on customer acquisition, marketing and server infrastructure. To drive growth, it focused on value-added services such as delivery and product handling for merchants, an executive told Bloomberg News.
“We expect to continue to be profitable and grow margins in the next quarters as well,” Bansal said on Friday, declining to give a specific figure.
Meesho competes with Amazon.com Inc and Walmart Inc in India’s growing e-commerce market, which is expected to grow to $325 billion by 2030 from $70 billion last year, according to Deloitte.
The company wants to focus on profitability, growth and adding users for some time before deciding to go public in India. Meesho, which now employs about 1,300 people, has started hiring again for certain roles that can further that ambition, Bansal said.
