Indian Startup Layoff Tracker

So far, 10,029 employees have been laid off by 27 startups, which includes unicorns such as Vedantu, Cars24, Ola, Meesho, MPL and Unacademy

Edtech has laid off the most employees, with 11 edtech startups laying off 4,068 employees in 2022 alone

As the alarm bells ring, here are the startups that issued pink slips in 2022

The year 2022 did not start well for the larger economic world, as a global sell-off pressure prompted a stock market crash earlier this month.

This has consequently seen startup funding slow down to a trickle. The first quarter of the year saw Indian startups rake in $11.7 Bn in funding, minting 13 unicorns in the process.

However, April only saw about $3.4 Bn in funding with no unicorns being produced. While May saw the minting of India’s 100th unicorn, it has been a slow month in terms of funding, with only $1.6 Bn brought in, falling 53% month-on-month.

June saw three startups added to India’s growing list of unicorns. In some relief to the startup ecosystem, the funding picked up by 69% to reach $2.65 Bn in the month. 

Therefore, during H1 2022, India has seen almost $19 Bn in startup funding. However, during H2 2021, Indian startups raised $31.58 Bn in funding or almost 70% more than H1 2022. It is clear that the funding momentum towards the end of 2021 has fizzled out.

The slowdown prompted marquee investors such as Sequoia, KKR and Y Combinator to instruct the startups in their portfolios on how to survive. There was a clear message in common across all investors: cut costs and increase runway.

Many of these startups seem to have interpreted that as a license to fire people as a “cost-cutting exercise”, disrupting thousands of livelihoods in the process.

So far, 11,168 employees have been laid off by 32 Indian startups, which include unicorns such as Cars24, Ola, Meesho, MPL, Trell, Unacademy and Vedantu. The list also includes Indiabulls’ social commerce venture Yaari.

In May alone, layoffs by 9 startups were reported impacting 3,379 employees. So far, June has seen layoffs by 18 startups. However, the number of employees affected is fewer than in May at 2,409.

Edtech has seen the most layoffs, followed by consumer services and ecommerce. The three sectors have collectively seen 21 startups lay off 9,659 employees so far. This means that almost 9 in every 10 employees laid off were working in either consumer services, ecommerce or edtech.

This is the reason why edtech has taken the most heat across all the industries. Along with having laid off almost 4,100 employees, it has also seen two companies shut down as well. The funding slowdown has impacted edtech startups disproportionately, it seems.

As the startup ecosystem braces for a funding winter and subsequent slowdown,a2z has compiled the list of startup layoffs that have taken place so far in 2022.

Indian Startup Layoffs

June 30 | Inc42 Exclusive: Edtech Startup Crejo.Fun Shuts Down, Leaving 170 Employees Without A Job

Bengaluru-based edtech startup Crejo.Fun became the second edtech startup to shut down in June alone after Udayy, after failing to raise funding and schools reopening. The company claims to have refunded all of the customers, while it works to sell the IP to return some capital to the investors.

The company had raised $3 Mn in pre-seed funding last year from Matrix Partners India and Flipkart cofounder Binny Bansal-backed venture capital firm 021 Capital. However, it had been more than 14 months since then and Crejo.Fun was under pressure to raise fresh funding. The company’s 170-strong workforce will receive salary for July and the company claims that almost 90% of the same have been placed elsewhere. 

Cofounder Vikas Bansal confirmed the development with Inc42, saying in a written statement that even though the company grew well even with schools reopening, it has decided to shut down operations. “However we were running out of funds and while we were trying to raise capital for the last couple of months, but given the fundraising environment, we were unable to raise funds,” Bansal added.

June 29 | Inc42 Exclusive: EV Mobility Startup Oye Rickshaw Lays Off 40 Employees

Gurugram-based EV mobility startup Oye Rickshaw laid off 40 employees amid increasing losses and declining business, becoming the first in its industry to do so. Employees from tech, sales, marketing and several on-ground executives have been laid off by the startup citing adverse market conditions.

Mohit Sharma, cofounder and CEO of Oye Rickshaw, in a statement, said, “As we head towards a market downturn, we have had to make some difficult decisions to ensure the company continues to stay stable and achieve our mission of redefining India’s EV ecosystem.” Sharma said that when market improves in the future, the startup would look to get some of the laid-off employees back on board.

After having raised INR 24 Cr in a debt round last year, Inc42 was also informed that Oye Rickshaw is raising another INR 40 Cr in debt for day-to-day operations and to buy more batteries for its battery-swapping business.

June 29 | BYJU’S-owned Toppr Lays Off 350+ Citing Restructuring

In another layoff at a BYJU’s-owned edtech company, Toppr has laid off around 350 employees citing company restructuring. Most of the impacted employees were subject matter experts, content developers, managers and heads of departments for various subjects, among others, according to Inc42 sources.

According to an email sent to laid-off employees accessed by Inc42, the company said that it conducted a restructuring and that left multiple roles redundant. Toppr will provide severance payment equivalent to the notice period of the laid-off employees, along with a package including 15 days’ salary for each year completed and prorata performance bonus (if applicable) till June 30.

A BYJU’s spokesperson told Inc42 that it has absorbed 80% of Toppr’s workforce, after having bought the edtech startup for $150 Mn last year. In FY21, Toppr incurred a loss of INR 125.9 Cr. It generated INR 52 Cr in revenue, of which INR 50.6 Cr came from operations. Its expense stood at INR 178 Cr during the same time.

June 28 | Nova Benefits Lays Off 70 Employees Citing Restructuring, Takes Total Layoffs To 80

Bengaluru-based employees wellness platform Nova Benefits has laid off 70 employees as a result of restructuring. Earlier this month, the startup had laid off 10 employees, and the current layoffs take the total employees impacted to 80, or about 40% of its total workforce. The employees were laid off from sales, accounts, marketing and creative teams, among others.

“We owe everyone at Nova a challenging, fast-paced growth path. However, in the face of our redefined business strategy, we cannot provide this to 30% of our teammates,” a mass mail accessed by Inc42 read. The startup also cited cost-cutting as a reason to lay people off and conduct a business restructuring.

The layoffs come four months after it raised an undisclosed amount from Naval Ravikant-backed AngelList Early-Stage Quant Fund. In September, last year, the startup had raised $10 Mn in its Series A which Inc42 had exclusively reported. The round back then was led by Susquehanna International Group (SIG) and Bessemer Venture Partners.

June 28 |  Exclusive: BYJU’s-owned WhiteHat Jr Lays Off 300 Citing Cost Cutting

After forcing around 1,000 employees to resign as it called them to work from office, BYJU’s-owned WhiteHat Jr has laid off around 300 employees to cut costs. The sales, marketing and operations teams were the affected teams, with the first two being the worst affected.

According to Inc42 sources, the management has cited business restructuring as the reason behind the layoffs. Another source informed Inc42 that the WhiteHat Jr is in process of firing more people, and the number of employees impacted could double to reach 600 by the end of it. The company is said to have run out of operating capital, and is set to be completely absorbed by BYJU’s, a person said on condition of anonymity.

WhiteHat Jr has been posting staggering losses. In FY21, the edtech startup recorded INR 1,690.4 Cr in losses. During the same fiscal, it spent INR 2,175.2 Cr to earn INR 483.9 Cr.

June 27 |  Exclusive: Ecommerce Platform Udaan Lays Off 180 Citing Cost Cutting

B2B ecommerce platform Udaan became the eighth ecommerce startup to lay employees off in 2022, laying off 180 employees citing cost-cutting. While the layoffs do not amount to a significant percentage of its employees, Inc42 sources said that there are more layoffs to come. The number of employees affected can reach as high as 600, sources said.

Udaan has conducted the layoffs mere months after it raised $250 Mn in a round from big-name investors such as Microsoft, M&G Prudential, Kaiser Permanente, Nomura, TOR and others. In a statement given to Inc42, Udaan said that it will support outgoing employees. Udaan has said that it will provide medical insurance, a compensation package and outplacement assistance.

Udaan generated INR 5,919 Cr in revenues at an expense of INR 8,742 Cr in FY21. The startup narrowed its loss to INR 2,482.3 Cr in FY21 from INR 2,518.7 Cr in FY20. According to an internal mail sent a week before the layoff, the CEO Vaibhav Gupta had said that Udaan was en route to hit positive unit economics by the end of the June quarter. However, the startup still cited unit economics as a reason to lay people off.

June 20 |  Exclusive: Sequoia Surge-backed Aqgromalin Lays Off 80 After Investors Back Out

Chennai-based Animal husbandry and aquaculture startup Aqgromalin laid off 80 full-time employees from its corporate offices as a funding round did not materialise. The layoffs account for 30% of the startup’s total workforce and have impacted marketing, sales and support, among other teams.

The funding round was supposed to be led by a Korean fund, which pulled out on the day of signing the deal. The layoffs came almost five months after Aqgromalin raised $5.25 Mn in a pre-Series A round from the likes of Sequoia India’s Surge, Omnivore Partners and Zephyr Peacock India.

The layoffs have also likely prompted a pivot in the startup’s business, as Inc42 sources told that Aqgromalin might look to move away from animal husbandry and focus only on its aquaculture business. The Chennai-based startup is also in talks for a potential merger, with Licious coming up as a potential candidate.

June 18 | Social Commerce Startup CityMall Lays Off 191 Employees Citing Restructuring

Gurugram-based social commerce startup CityMall has laid off 191 employees, both on-roll and off-roll, across multiple positions citing restructuring. The move comes three months after the startup had raised $75 Mn in its Series C round of funding.

The startup has shuttered its operations in Noida and is likely to do the same at the warehouse in Jaipur, according to Inc42 sources. The startup has also closed two dark stores for one-day delivery in Rohtak and Gurugram.

CityMall recorded a loss of INR 15.18 Cr in FY21, having spent INR 28.9 Cr to make INR 15.18 Cr. A CityMall spokesperson, confirming the development, told \that the startup will provide outgoing employees with outplacement assistance to find jobs at other places.

June 17 | \ Exclusive: Unacademy Lays Off 150 Employees, Takes Total Layoffs To 1,150

It has been a difficult few months to be an edtech employee, and this is far more evident at Unacademy than anywhere else.

The edtech unicorn has conducted four separate layoffs citing cost-cutting, performance reviews, restructuring and whatnot, as it pivots to offline and perhaps more interestingly, into SaaS with Cohesive, all in a bid to achieve profitability.

In late March, Inc42 first reported that in a cost-cutting exercise, the edtech startup had laid off more than 125 consultants from its PrepLadder team. PrepLadder, which was acquired by Unacademy in July 2020 for $50 Mn, gives students material for competitive exams such as IIT/JEE, NEET and so on.

Days later, Unacademy laid off more than 200 teachers in a cost restructuring exercise. Inc42 exclusively reported that the edtech unicorn fired the educators based on their poor performance. In early April, the startup laid teachers off again, this time firing 600 teachers. The layoffs, according to a company spokesperson, were based on several assessments to determine the performance.

The latest layoff has seen Unacademy lay off 150 more employees, mostly from its sales and operations verticals. According to Inc42 sources, the impacted employees are from Unacademy Group’s core business, Unacademy, and PrepLadder.

June 16 |  Exclusive: IPO-Bound PharmEasy Lays Off 40 Employees From Subsidiary Docon Technologies 

PharmEasy’s parent company, API Holdings has laid off 40 employees from its subsidiary Docon Technologies, an EMR or electronic medical record solutions provider. Docon has seen layoffs mostly across the sales background, such as business development managers, cluster heads and area managers.

Docon has been taken apart and incorporated into PharmEasy by API Holdings, forming PharmEasy One. According to Inc42 sources, many of the employees had resigned following the restructuring, and the remaining 40 employees were the ones that were laid off from the Docon team.

Docon Technologies made a loss of INR 29.7 Cr in FY21 against a total income of INR 2.25 Cr. Currently, it has stopped all on-ground operations and is working virtually.