Facily fires 200 people four months after becoming ‘unicorn’ – Link

Just four months after becoming a “unicorn” (startup valued at US$ 1 billion), Facily, which operates as a digital hypermarket of collective purchases, made a big cut in employees this Tuesday, 19. According to a list to which the Estadão had access, at least 84 people were laid off.

According to the Estadão, the cuts took place in the areas of data, support, products, engineering, research and service. Some positions still listed as affected by the dismissal include senior positions.

Diego Dzodan is co-founder of Facily, a digital hypermarket startup with collective purchases

The list, released by a former employee, has 84 names, but the total number of employees who left the company may be even higher, as inclusion in the list was voluntary. However, according to dismissed employees interviewed by the Estadãointernally it is said that the cut is between 200 and 300 employees.

To the EstadãoFacily confirmed the layoffs but said it would not comment on the total number of employees laid off.

The layoff comes less than four months after the startup received a $135 million funding, in an extension of the investment round originally raised in November 2021, when it had already received $250 million.

At the time of the investment, the executive president of Facily, Diego Dzodan, said that the new financial resources would allow the expansion of the operation in Brazil and to other Latin American countries, such as Mexico and Colombia.

In a note, Facily tried to justify the cuts: “Facily seeks constant evolution and efficiency to improve the experience of everyone who is part of and interacts with the company. Changes, including in teams, are necessary for this”.

wave of layoffs

Facily is the third Brazilian unicorn to make large layoffs in just over a week.

THE Estadão revealed last week that QuintoAndar carried out layoffs that affected several areas of the startup, such as technology, marketing and human resources. Initially, there was talk internally that the cut would have reached 20% of the staff of 4 thousand employees.

Subsequently, QuintoAndar confirmed that it laid off 4% of its employees – at the time, the company also denied that it was going through a crisis and said that it had to accommodate the six startups acquired in recent months.

Now, QuintoAndar seems to signal that there is a slowdown in the startup ecosystem. Two weeks ago, Masayoshi Son, president of SoftBank, one of the largest investors in startups in the country and an investor in QuintoAndar, said that the Japanese conglomerate should reduce investments in technology companies this year due to the poor results of the companies in which it invests – the information are from the newspaper Financial Times.

This Monday, the 18th, it was Loft’s turn, which laid off 159 employees and reassigned another 52 people as part of a plan to consolidate the company’s credit area.

How it works

Acting as a digital hypermarket, Facily sells food and cleaning products and is expected to expand into the fashion, home decor and electronics categories in the coming months. But, unlike e-commerce rivals who leave orders at the door, it is the customer who picks up the purchases at pick-up points chosen by the startup, which reduces the costs of the entire operation by taking hundreds of delivery men off the streets. and vehicle fleets.

Currently, there are 12,000 of these distribution centers in 9 cities in Brazil, including São Paulo and Rio de Janeiro.

In addition, Facily is also a “social commerce”, a model in which e-commerce platforms are inspired by social networks to offer interaction with customers through engagement. In the case of the startup, users with common shopping interests join groups to earn discounts, similar to sites like Groupon.

Finally, still seeking to reduce prices, the company negotiates the items directly with producers, bypassing intermediaries and suppliers in the supply chain.

Claims

Last November, just before raising US$ 250 million, Facily signed an agreement with Procon-SP to reduce customer complaints against the startup by up to 80% — by October 2021, more than 151,000 complaints had been made. on the consumer protection agency’s website, with users complaining of late deliveries, wrong orders, lack of refunds and expired and damaged products. In comparison, the previous year had only 25 objections.

According to Dzodan, the startup’s rapid growth in 2021 has disrupted the company’s operations, which recorded a record 7.1 million orders placed last October.

“We grew much faster than we expected, and that took our ability to deliver. The increase in order volume requires more partnerships and more training of people, which takes time to develop,” he explains. “The platform was not so ready.”

As part of the agreement with Procon, which considered suspending the company’s operations, Facily will indemnify the injured consumers and create a fund of R$ 250 million to improve the startup’s Customer Service (SAC). For each unresolved complaint, the company will be required to pay R$1,000 to a consumer protection fund maintained by the government of São Paulo.

“Facily must comply with all the points established in the agreement. Otherwise, we will apply the fine provided for by the Consumer Defense Code, which reaches more than R$ 10 million”, says Fernando Capez, executive director of Procon-SP.