Mamaearth, a popular direct-to-consumer brand, has made the decision to lay off employees within its parenting content platform called Momspresso. The layoffs will impact around 80-100 employees.
According to The Hindu Business Line, Mamaearth acquired a majority stake in Momspresso for ₹152.3 crore in 2021. Momspresso operates different segments, including a user-generated content platform, brand marketing services, and MyMoney, an influencer engagement platform.
Sources reveal that Momspresso and MyMoney will be closed by the end of this month due to increasing losses in the MyMoney segment.
According to Mamaearth’s Draft Red Herring Prospectus (DRHP), the net value of Momspresso, after deducting liabilities, was ₹16.2 crore during its acquisition in December 2021.
In the financial year 2021-22, Momspresso reported a significant increase in losses, reaching ₹10.9 crore compared to ₹25.7 lakh in the previous fiscal year. Revenue, however, experienced a modest growth of 1.1 times, reaching ₹31.2 crore compared to ₹27 crore in FY21.
Mamaearth, which had plans for an initial public offering (IPO), postponed the IPO filing in March due to unfavorable market conditions. The skincare start-up was founded in 2016 by Varun and Ghazal Alagh and has received investments from notable firms like Sequoia Capital and Sofina from Belgium.