Mass layoffs at delivery service startup Circus Kitchens

Mass layoffs at delivery service startup Circus Kitchens

The startup company behind the innovative food app Circus has recently undertaken a workforce reduction, resulting in the layoff of 35 employees. Contrary to popular belief, the decision was not motivated by a lack of financial resources, as clarified by a spokesperson.

Circus Kitchens, founded by Nikolas Bullwinkel and Saad Saeed, who were previously involved in establishing the delivery service Flink, implemented the layoffs on Monday. This included 18 employees from their headquarters and 17 employees from their operational teams. The company disclosed this information in response to inquiries from the startup community.

When asked about the reasons behind the layoffs, the company spokesperson provided several explanations. Firstly, Circus made the strategic decision to “temporarily suspend operations in one of the three delivery areas in Hamburg.” Consequently, 17 employees were affected. Circus intends to introduce a pick-up option alongside their delivery service, necessitating “new requirements for our kitchens and the necessary restructuring of our operational teams,” as stated by the spokesperson. The company is actively seeking a more suitable location to accommodate this expanded concept.

In regards to the layoffs at the headquarters, Circus attributed them to the “current economic climate within the startup ecosystem,” which continues to be characterized by uncertainty. Circus emphasized its unwavering commitment to increasing operational efficiency and promptly achieving profitability, stating, “For this reason, we have made the difficult decision to part ways with 18 employees at our headquarters.” This figure represents approximately 25% of the local workforce, as confirmed by Gründerszene, a leading media outlet for startups.

Circus vehemently denies rumors suggesting a lack of capital, asserting, “Following a highly successful launch last year, we secured €11 million in seed financing in November 2022. Currently, we do not depend on additional capital,” declared the company spokesperson.

The founder of Circus, Nikolas Bullwinkel, is not new to the startup scene. He established Circus Kitchens in August 2021, shortly after selling his previous startup, Pickery, to Berlin-based entrepreneurs Julian Dames, Christoph Cordes, and Oliver Merkel in December 2020. Backed by venture capital firms Cherry Ventures and Northzone, the goal was to create a competitor to the popular fast delivery service Gorillas. Bullwinkel was also involved in the establishment of Considerable, a delivery service.

Circus specializes in the delivery of freshly cooked food, distinguishing itself as a delivery service catering to Essen (the German word for food). The startup entered the market in June 2022 and focuses on delivering meals during peak hours, which includes weekdays at lunchtime and in the evening, and exclusively in the evenings on weekends. Customers can only place orders through the app, with a minimum order value of six euros. Each location has its own delivery kitchen, and couriers are responsible for delivering salads, pizzas, and curries to customers’ homes. Circus operates as a combination of a fast delivery service and ghost restaurant. Currently, the company operates exclusively in Hamburg and Cologne.

It is worth noting that Circus is not the only player in the delivery food industry seeking to redefine the market. Other startups, such as Lanch, founded by Nono Konopka, Kevin Kock, and Jonas Meynert, aim to revolutionize both the delivery food sector and the realm of content creators by establishing a network of 70 influencer restaurants simultaneously.

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