Startups in India are resorting to layoffs as they face a funding winter hitting growth and late-stage companies in 2023. Startups like Dealshare, GoMechanic, MohallaTech, Swiggy, Dunzo, Ola, Cashfree, Byju’s, Vedantu, and Unacademy have downsized staff to extend their cash runways. Livspace, an omnichannel home interiors and renovation platform, has also laid off employees to drive profitability. The startup is cutting costs by scaling down on software services and moving plans from premium to basic. Its competitor, HomeLane, has also undertaken a cost-cutting exercise aimed at driving profitability. Its founder and CEO, Srikanth Iyer, said that they had to resize because they had to cut down on some fixed costs.
Livspace, an omnichannel home interiors and renovation platform valued at $1.2 billion, has laid off about 2% of its total workforce in an attempt to drive profitability by the end of the financial year in March 2024. The company has retrenched 45% of its technology and product teams, leading to the departure of 36 staffers, including software engineering developers and directors from a team of 80. The company is providing employees with assistance packages, extended medical insurance, and necessary outplacement services wherever possible within its network. Founded in 2015 by Ramakant Sharma and Anuj Srivastava, Livspace provides a three-sided marketplace and design automation platform that connects homeowners, certified designers, and vendors. Its investors include KKR, Ingka Group Investments, Jungle Ventures, Venturi Partners, and Peugeot Investments, among others. Till date, the company has raised $450 million from investors. Livspace employs a total of 5,000 employees, and it is unclear whether the layoffs included non-tech employees.
Livspace, a Bengaluru-based startup, has laid off employees in an attempt to deliver on profitability. The startup has been cutting costs by scaling down on software services and moving plans from premium to basic since September 2022. A source stated that there is a lot of pressure on the company to deliver on profitability, and any work not involving profitability is being taken out. The affected employees were informed of the layoffs from Thursday to Saturday in conversations with a human resources executive and the chief technology officer Praveen Kumar. They will receive severance packages based on the number of weeks that equate to the number of years served at the startup. In response to the ET’s request for comment, a spokesperson said that in a company of Livspace’s size, it is organic to redeploy resources in the normal course of operations, reflecting adjustments and/or performance management parameters. In October last year, Livspace had set aside $100 million for acquisitions to deepen its presence in existing geographies, add new categories to its core offerings, and introduce more margins to its overall business. In 2020, Livspace had laid off 450 employees, which amounted to 15% of its total workforce, due to the impact of Covid-19 induced lockdowns.
Startups are resorting to layoffs to extend their cash runways in the face of a funding winter hitting growth and late-stage companies in 2023. Mature tech companies like Dealshare, GoMechanic, MohallaTech, Swiggy, Dunzo, Ola, Cashfree, Byju’s, Vedantu, and Unacademy have downsized staff. Livspace competitor HomeLane recently undertook a cost-cutting exercise that led to the termination of a significant chunk of the company’s technology and product roles. The move was aimed at driving profitability. The founder and CEO of HomeLane, Srikanth Iyer, said that they had to resize because they had to cut down on some fixed costs.
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