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Now startups are curbing the future of the employees. It is shocking to hear. But the fact is that many Indian startups are firing Their employees. Now in 2022, almost 8000 employees have lost their jobs in startups.
Startup layoffs have become a hot topic. There is a Quick Buzz around the startup ecosystem about the shortage of findings. Many startups are struggling to make profits. Especially the startup that is in the ed-tech space.
The especially online learning platform is struggling to keep their uses in their platforms. Now startups are trying to reduce cash burn. The easiest way to save their cash is by firing Their employees.
So in this blog, we are going to take care of depth analysis of startup layoffs.
Indian Startup Layoffs 2022
Indian startup had a great year in 2021. Because 44 startups have turned into unicorns. Where startups have been valued at over 1 billion dollars. In Indian currency, it’s almost 7500 crores.
Even in 2022, Indian startups had witnessed over 15 startups turned Unicorn in the first quarter. But now, the situation is not the same as earlier. There are a lot of issues when startups are facing.
There is a huge shortage of funding for Indian startups. Now Many investors are turned their back on investing. The market is not good enough right now. Even many startup IPOs are also postponed for this reason. Oyo IPO was about to launch but was postponed due to critical market fluctuations.
Now startups have awareness of the cash reserves. Even they have to run their businesses with the remaining funding. So, startups are aiming to become profitable this year. Then they can easily raise funds with their profitable business.
However now startups are trying to save their funding. So now Indian startups layoffs critical point. The situation has gone to a level, where employees are fired zoom call.
Edtech Startup Layoffs Reasons
Edtech startups are busy laying off their employees. The story behind the growth of the Edtech startup is magical. Prior, 2021 online learning platform work growing at a slow pace. Because in India, there are a lot of schools colleges, and offline tuitions. So it was difficult for Indian Edtech Startups to tackle the offline market.
So it was it pretty tedious job for Edtech the startup to onboard new users. Also difficult to retain the existing users as well. All of a sudden, the coronavirus pandemic broke in India in 2020.
It was an extraordinary benefit for an online learning platform. On the other hand, schools, and offline institutions were shut down. So, schools and colleges started transforming online.
But many schools and colleges did not have the facilities to quickly adapt to the online environment. So the quality of online education was not up to the standards. So many students were struggling to understand the concepts.
Then Edtech startups were raising in India. However, Edtech Startups one having extraordinary facilities and technologies for online teaching. Even students word happy with the quality of online education with the Edtech Startups.
So Edtech startups witnessed youth growth in their user base. Especially, Byjus had over 85 million users in their app. Even Byjus valuation also crossed 16 billion dollars. So there was tremendous growth in online learning platforms.
Edtech startups started to hire more employees and instructors. So that they can read the present demand. From 2020 to 2022 Edtech startup growth was magical.
There was an instance when Byjus acquired Aakash educational institution for 1 billion dollars. In Indian currency, it was approximately about 7000 crores. It was a glimpse of the growth of online learning platforms. Where it acquire the use company Aakash institution with head functioned over a decade.
Also Read: Cred startup story
Declination of Edtech after Corona Pandemic
But things start changing in 2022. All schools, colleges, and tuitions work again and started functioning. Even the corona pandemic was also faded. Then the students gradually e started to transform from online learning to offline learning.
So it was hard, for Edtech Startups to retain the existing users. The user base gradually came down. Now startups realize about their revenue, funding, and growth.
Now, startup layoffs become a trend in the Edtech sector. Edtech startup Unacademy has Laidoffs more than 1000 employees in 2022. Even the Unacademy
The startup laid-off instructors to reduce cash burn.
It was not limited to Unacademy, Startup layoffs became the trend in Vedantu as well. Vedantu easy online learning platform, where it gives services for 10th,12th, and competitive exams.
The company also laid off 700 employees in 2022. Vedantu founder Vamshi Krishnan also claimed that the startup decided to sustain itself with the funding. Even Vamshi Krishnan told that there was a shortage in the funding in the future.
Startup Layoffs 2022 included Lido Edtech Startup. Lido offers online education for English, maths, science, and coding classes for the students. Now, Lido is Layoffs over 1200 employees.
Other Indian Startup Layoffs
Startup Layoffs are not limited to online learning platforms but also affected two other startups.
Meesho, social commerce startup also Laidoffs over 150 e employees. The main reason for the layoffs is changing business model. Basically, Meesho was operating as a social commerce platform. But now it is transforming into a full e-commerce model. So, there is a modification and elimination of some operations. Eventually, it resulted in firing employees.
Even Cars24, an automobile startup also fired over 600 employees. The reason for the layoffs is mainly cost-cutting.
Online grocery delivery startup, Blinkit is also top among the startup layoffs in 2022. Now, Blinkit fired over 1600 employees. Formerly known as Grofers. As of now, it is transforming into a quick commerce model. It claims uses to deliver groceries within 10 minutes. So there is a huge pressure to print dark stores in order to fulfill their claim.
It is funding intensive business model. Where findings play an important 2 in growth and scaling up the business. There is a shortage of findings, so the company helplessly laid off its employees.
Furlenco furniture rental startup laid off over 200 of its employees due to a shortage of funding.
As Edtech startup is deeply suffering in the declaration of their user base. Even Whitehat JR also facing the same issues. So, helplessly the company laid off more than 1000 employees or instructors in 2022.
Even Trell, a short video app, also laid off more than 300 employees for the reason of cost-cutting.
In this way, Startup layoffs are becoming more intensive. It is also predicted that more than 10000 employees will lose their jobs in the next 3 months. So it is very difficult for employees to sustain themselves in the startup ecosystem.