Red.Health, backed by Kalaari Capital, faces challenges in meeting payroll obligations.

Red.Health, a company backed by Kalaari Capital, has partially delayed January salaries for its employees, with only 50% disbursed so far. The company, which operates as an ambulance aggregator, has been facing financial difficulties according to sources aware of the matter.

The delay in salary payments has raised concerns among the staff, as the remaining 50% of the wages have not yet been credited. In December, the company also faced a two-day delay in disbursing salaries, with communication over email. However, this time, there has been no communication over email, and all updates are being provided over calls, according to an employee.

The founder and CEO of Red.Health, Prabhdeep Singh, attributed the salary delays to the prioritization of launching three big hospitals and forward investments. Singh mentioned that the company is awaiting funding, and most of the salaries have already been paid. He also stated that the company will announce its fundraise in the next 15 days, which is expected to be one of the largest Series B funding rounds in India.

Despite the company’s claims of business growth, sources have indicated that Red.Health has been struggling to raise funding for an extended period and is likely facing challenges in scaling its business. The company has raised a total of $22.6 million in funding, with about $20 million coming from a Series A funding round in January 2022.

Red.Health has also been impacted by layoffs, with about 800 employees being let go since mid-last year. Additionally, the company’s chief business officer is set to leave in February, according to sources.

This situation reflects a broader trend of startups in India, including Byju’s, Dunzo, and Exampur, delaying employee salary payments due to financial difficulties. Red.Health, which operates as an emergency response platform that aggregates ambulances, posted a revenue of ₹46 crore and a loss of ₹1.4 crore in FY22. The company has not disclosed details on the investments being made in the hospital business and the quantum of funds to be raised in the Series B round.