Zomato employees once took a 20% salary cut when times were tough. That later became a 30X fortune, recalls ex-staffer

A pay cut in a company is not the most welcoming move. However, when it was done at Zomato, the extraordinary decision ended up becoming the company's survival story. When the food delivery business was brought to a near standstill, the company had only about 45 days of cash left, according to co-founder, Deepinder Goyal. Employees were asked to sacrifice part of their salaries, with more than 80% agreeing. Years later, former Zomato employee, Sanchit Goyal recalled taking a 20% cut and how the decision eventually paid off.

Zomato employees took salary cuts

The pandemic brought many businesses to an abrupt halt, and Zomato’s food delivery operations were among those hit particularly hard. For employees, the crisis meant more than uncertainty about jobs. They were also asked to make a personal financial sacrifice to help the company survive. Sanchit Goyal, a former Zomato employee based in Bengaluru and founder of an online publication, recently took to X to recall the period. “I took a 20% pay cut,” Sanchit wrote.

He remembered a town hall held soon after the pandemic began, when Deepinder Goyal appealed to employees to accept salary reductions to help keep the company afloat. According to Sanchit, the Zomato chief was emotional during the appeal, which encouraged employees to support the company through the difficult period. “That’s why everyone supported Zomato in that phase,” he recalled.

Deepinder Goyal reveals Zomato had only 45 days of cash

In an interview with Raj Shamani, Deepinder Goyal offered a glimpse into just how serious the situation had become. “The food delivery business got just like wiped out, shut down,” Goyal said, explaining how quickly Zomato’s business was affected. The company suddenly found itself with only 45 days of money left, he revealed. “One and a half months” was an extremely short runway, Goyal explained, because a single wrong decision could leave the company unable to meet its payroll obligations. He recalled thinking that if he could raise $1 million to $2 million, it would at least help Zomato make the next payroll.

Zomato approached investors but raised zero

With the company running short on cash, Goyal said Zomato reached out to investors and venture capitalists. But the fundraising effort did not deliver the immediate solution the company needed. When asked how much money was raised at that time, he said, "Zero". The company then turned to its own employees. "We asked for salary cuts,” Goyal recalled. According to him, more than 80% of Zomato employees took a salary cut during the crisis.

For the company, the move provided much-needed breathing room at a time when its core business had been severely disrupted.

Employees later got their salary cuts back

For employees who agreed to sacrifice part of their income, the decision did not ultimately mean permanently losing that money. Goyal said that as Zomato’s situation improved, employees got back the money that had been cut from their salaries. Goyal’s account also highlights another part of the compensation offered to employees during the crisis. He said employees were given equity, describing it as a “thank you so much” gesture for supporting the company during its most difficult period.

Zomato IPO turned the sacrifice into a bigger payoff

The company’s eventual public listing gave that equity an even greater significance. Goyal recalled that when Zomato got listed, employees who had sacrificed cash in exchange for equity saw a dramatic increase in the value of their holdings. “If they let go of Rs 100 of cash, they made 30x in that IPO,” he said.

For Goyal, the equity was ultimately a way of recognising the employees who had stood by Zomato when the company was struggling to survive.

About Deepinder Goyal

IIT Delhi graduate Deepinder Goyal co-founded Foodiebay in 2008 as a restaurant discovery platform, helping users access digital menus, reviews and information about eateries. In 2010, it adopted the name Zomato and gradually moved beyond restaurant listings into food delivery and other services. Zomato marked another major milestone in 2021 when it became a publicly listed company. The following year, it acquired online grocery platform Grofers, which was subsequently rebranded as Blinkit and transformed into a major player in India’s quick-commerce market.

As Goyal’s business empire expanded beyond food delivery, the parent group underwent another transformation. Zomato’s corporate identity was eventually renamed Eternal, reflecting its broader portfolio of businesses. The group has since grown into one of India’s most valuable consumer internet companies, with its market capitalisation currently estimated at around Rs 2.89 lakh crore.