Zilingo, a Singapore-based B2B fashion technology platform, has laid off 44 of its 900 global employees as part of a company-wide restructuring measure to refocus on Asia and emerging markets.
In cutting nearly 5 percent of its workforce, the company is streamlining its business to focus on profitability and putting expansion efforts on hold in the U.S. and Europe, where business is slumping due to the coronavirus outbreak.
This represents a major change in direction for Zilingo, which was valued at $970 million in February 2019 before raising $226 million in two months later from Singapore-based investment company Temasek Holdings, Sequoia Capital and other investors. In October, Zilingo then invested $100 million in growing its fashion supply chain operation, including hiring U.S. sales and products teams and entering new markets including Europe, Australia and the Middle East.
In December 2019, Zilingo acquired Sri Lankan SaaS startup nCinga for $15.5 million in a deal designed to improve efficiency and facilitate better insight into what’s happening on factory floors, rolling out the Internet of Things technology in key sourcing markets such as Vietnam, Bangladesh, India, Indonesia, Thailand and Turkey.
Zilingo has a global partner network that has connected 75,000 retailers and 6,000 compliant factories and suppliers across 17 countries and is designed to give retailers access to a sustainable, transparent, affordable supply chain in new markets. The company offered users access to unlocked credit, working capital and insurance, making it more viable for a smaller business.
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The affected employees were told the news via a Zoom teleconferencing call and asked to sign a termination agreement the same day, according to The Business Times (BT). The majority of the 35 full-time employees who were laid off live in Singapore.
The affected employees were said to have been put on 45 days of gardening leave as compensation regardless of tenure; those who declined to sign the termination agreement were told that their time of paid absence from work would be cut down to 30 days. News of the layoff was not internally communicated; some employees found out about it from BT on Saturday, according to the report.
Co-founders Ankiti Bose and Dhruv Kapoor started Zilingo in 2015 as an e-commerce platform through which merchants could sell directly to end consumers in Southeast Asia, and quickly expanded the technology into the B2B space so that it could serve as a network of supply chain pieces—across manufacturing, logistics, product development and more—that it can take to retailers or brands.
Now, the software is designed to enable sellers and factories to digitize, automate and scale their business, while sidestepping middlemen within the supply chain. The Zilingo platform incorporates artificial intelligence to predict upcoming fashion trends that can be produced and on shelves in as little as 21 days to reduce overproduction and waste.
Zilingo did not immediately respond to a request for comment.