Several start-ups this year have resorted to layoffs of employees in order to cut costs and reduce role redundancy. The latest in the list is edtech platform Vedantu Innovation that has laid off 200, or 3.5 per cent of its workforce of 6,000 employees.
The company’s spokesperson in a statement said 120 of the laid off employees were on contract and 80 were full-time employees. “We have an annual contract with them, and at the beginning of every academic year, we follow a process of load rebalancing where we rejig pertaining to these roles, based on our growth expectations.”
The spokesperson, however, added that the company is also hiring more than 1,000 employees in various teams. Vedantu was founded by Vamsi Krishna, Anand Prakash and Pulkit Jain in 2011. It became a unicorn start-up after it raised USD 100 million (Rs 740 crore) in September last year. A unicorn is a start-up with a valuation of at least USD 1 billion.
Before Vedantu, start-ups including Meesho, Unacademy, Furlenco, Trell, OkCredit and Lido laid off their employees.
Edtech company Unacademy last month laid off around 600 employees on account of non-performance and role redundancy. The retrenched employees include contractual workers and educators.
E-commerce company firm Meesho has also laid off 150 employees from its grocery business, which it recently restructured and rebranded as Meesho Superstore from Farmiso earlier. Meesho has said about 150 full-time employees will be impacted by the restructuring of Meesho Superstore, which is aimed at bringing inefficiencies. It is offering severance packages and outplacement assistance to help those impacted secure new opportunities outside the company.
Furniture rental start-up Furlenco has resorted to layoff of about 180-200 employees. A bulk of them were in customer support roles, including grievance management, and scheduling, among other operations. The company is backed by the likes of UAE-based CE-Ventures, Zinnia Global Fund, Lightbox, and Bollywood actor Aamir Khan, among others.
Trell, which is a influencer-led social commerce start-up, also last month laid off almost 300 people, close to half of its workforce. The rental startup has raised USD 60 million since it was founded in 2012 by former Goldman Sachs and Morgan Stanley executive Ajith Mohan Karimpana. It competes with the likes of Rentomojo and Cityfurnish.
OkCredit, part of Ok Network’s ecosystem of apps for small and medium enterprises (SMEs) in India, in February also laid off 35-40 employees across all functions. It was 35 per cent of its workforce.
Edtech start-up Lido also laid off 900-1,200 staff members in February. The start-up’s employee strength is around 1,000, and it has laid off 150-200 employees. These employees were reported to have underperformed and were also not regular to the office.
Over 1,900 employees have been impacted in the latest round of cutbacks at start-ups across India. Such layoffs were also experienced after funding peaked in 2015 and 2016 across the start-up ecosystem.
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