Reliance Retail-backed delivery startup Dunzo Digital to face insolvency proceedings

The National Company Law Tribunal (NCLT) has dismissed a fresh insolvency plea filed by Exotel Techcom Pvt. Ltd. against Dunzo Digital Pvt. Ltd., noting that the Bengaluru-based hyperlocal delivery startup has already been admitted into the Corporate Insolvency Resolution Process (CIRP).

Exotel, an operational creditor, had moved the tribunal under Section 9 of the Insolvency and Bankruptcy Code (IBC), 2016, seeking initiation of CIRP against Dunzo. However, the bench observed that Dunzo had already been admitted to insolvency on August 6, 2025, in a petition filed by Velvin Packaging Solutions Pvt. Ltd. in CP (IB) No.36/BB/2024. An Interim Resolution Professional (IRP) has already been appointed in that matter.

The tribunal clarified that Exotel, as an operational creditor, may file its claim before the IRP/Resolution Professional in line with the IBC framework.

Founded in 2014 by Mukund Jha, Kabeer Biswas, Dalvir Suri and Ankur Agarwal, Dunzo was once among India’s most prominent hyperlocal delivery platforms, offering on-demand services for groceries, food and essentials. The company had raised about $449 million over 18 rounds from marquee investors including Google, Reliance Retail and Lightrock India, and was last valued at around ₹6,350 crore.

Despite its high-profile backers, including institutional investors such as Lightbox and angels like Deep Kalra, Dunzo struggled with mounting losses, stiff competition from Swiggy, Blinkit and Grab, and a sharp drop in employee strength. Its headcount fell by more than 55% between January 2024 and January 2025, to around 158 employees.

The collapse of Dunzo marks one of the most high-profile failures in India’s consumer-tech ecosystem, with the once-celebrated startup now in CIRP as creditors seek resolution for outstanding dues.

Reliance Retail has officially written off its ₹1,645 crore investment in Dunzo, nearly 3 years after funding the company in an ambitious push into India’s quick commerce sector.

In January 2022, Reliance Retail, along with co-investors including Lightbox, Lightrock, and Google India, led a $240 million (₹1,800 crore) funding round in Dunzo. Reliance Retail received a 26% stake and anticipated that Dunzo would power last-mile delivery for its JioMart and retail businesses. However, the startup’s financials began deteriorating rapidly, culminating in its losses reaching ₹1,800 crore in FY23, nearly 4 times higher than the previous fiscal year, even as revenue rose to ₹226 crore.

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