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ReshaMandi layoffs: B2B marketplace ReshaMandi fires 80% of workforce amid fund crunch


ReshaMandi, a business-to-business (B2B) marketplace focused on silk products, has laid off 80% of its employees after it failed to secure Series B funding.

The company has been forced to massively scale down its operations since last year.

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With a debt of more than Rs 300 crore, ReshaMandi is facing court cases from lenders and vendors and some creditors are even planning to file for insolvency, said two officials privy to the development.

ReshaMandi, which has raised around $70 million in equity and debt, counts Creation Investments and Omnivore as its backers. Founded in 2020, the company provides a full-stack digital ecosystem of natural fibre from farm to fashion in the agritech space.

The company did not respond to ET’s email query.

The last funding of Rs 225 crore in an equity plus debt round saw participation from Omnivore, which led the seed round of ReshaMandi, 9 Unicorns, Venture Catalysts, Sandeep Singhal of Nexus, and IndiaMART founder Brijesh Agarwal, among others. Debt investors include Northern Arc, Alteria, Innoven, and Stride Ventures.

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“The previous funding was at a valuation of $175 million which has come down significantly when the company tried to raise $5 million in January this year at a valuation of $25 million. Despite the down round expectations, it could not raise any funds,” said one of the creditors planning to file for ReshaMandi’s insolvency.LegalPay, a tech-based interim financier and litigation funder for commercial litigations said on average, resolving a stressed company under the Insolvency and Bankruptcy Code (IBC) takes 632 days, exceeding the stipulated 270 days. However, in cases where companies file for voluntary bankruptcy, the time taken is 541 days.

“Self-initiation of insolvency has both pros and cons. On the positive side, it enables timely action to protect the business, halts legal proceedings, and can lead to creditor settlements. However, it also risks losing control of the company, potential liquidation, and a decrease in asset value,” said Kundan Shahi, chief executive officer of LegalPay.



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