Ailing delivery startup Honestbee lays off 80% of its employees in Singapore

Habitat by Honestbee.

Singapore-based troubled delivery startup Honestbee has laid off around 80 per cent of its staff or roughly 100 employees in the city-state as it comes under pressure of a capital crunch amid the ongoing COVID-19 outbreak.

The Business Times and Straits Times reported that the terminations were made Monday evening, affecting both foreign and local staff. Honestbee verified the job cuts, confirming that it made a strategic decision to reduce its staff count, particularly in non-core sectors such as its brick-and-mortar grocery store Habitat.

Honestbee is no longer operational regionally. During its heyday, the Singaporean grocery startup was present in multiple markets across Hong Kong, Taiwan, Thailand, Indonesia, Malaysia, Bangkok, Philippines and Japan.

“Due to several external commercial pressures that have resulted in the protracted closure of habitat by honestbee, the company has made the strategic decision to reduce its staff force. As a result, the company has decided to reduce its non-core staff as it does not foresee operating habitat in its full strength over the next few weeks,” said an Honestbee spokesperson in an email statement.

Habitat has been shut since February 10 or about a month now, due to the coronavirus outbreak resulting in a drop in walk-in traffic. The supermarket has even moved out of its spacious outlet at 34 Boon Leat Terrace to a tiny shophouse unit in Upper East Coast Road, according to reports. The swanky, digital-centric grocery store was once cited as a cornerstone of Honestbee’s turnaround plan.

That is becoming less and less certain right now.

Honestbee has yet to convince investors to put in some much-needed cash. The startup remains under interim court protection as it seeks to pass a scheme of arrangement to restructure itself out of some $230 million of debt.

A “retail conglomerate” was reported to have considered injecting some $50 million into Honestbee, but has since stepped back due to the COVID-19 outbreak and restructuring concerns.

In January, Honestbee signed an agreement with multiple existing investors to receive about $7 million in capital to pay off its creditors in a cash and equity deal to clean up its balance sheet. These investors were FLK Holdings, a US incorporated company backed by Brian Koo, Formation Group Fund I, and Formation Group (Cayman) Fund I. Brian Koo is Honestbee’s former chairman and interim chief executive. All three funds are linked to Koo. He is also Honestbee’s only secured creditor and belongs to the family which controls South Korea tech giant, LG.

Little is known about the future direction of Honestbee’s Habitat, except that it will be a quick-service restaurant (QSR) pizza concept and tech-enabled convenience store. Honestbee said that plans for this is still in its “very early stages”, with the convenience store focused on fast food service for takeaway. It will also likely tap on Honestbee’s existing technologies in payments and collection.

Honestbee’s next court hearing on its restructuring will take place on 26 March 2020.

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.