Indians on H1B visas in the US and those working for big tech back home are among the two lakh professionals hit by mass layoffs in the tech sector. At the same time among new age digital startups in India, edtech platforms have already fired more than 7,000 employees in 2022, since funding has dried up. Joining names such as Unacademy and Byju’s, online education firm Vedantu has also fired 385 people more, bringing its total to 1,100.
Slashing workforce while expanding operations
The edtech startup had reported a loss of Rs 604 crore in FY21, but had also invested in acquiring test preparation platform Deeksha in October this year. Vedantu achieved Unicorn status last year, after bagging a $100 million funding, and has spent thrice as much as its competitor Unacademy. The firm which has laid off people in four rounds so far, has also been offering salary for two months as severance payment, and has extended health insurance for fired employees to March 2023.
Founders also affected?
Left with 3,300 employees after the recent layoff, Vedantu’s founding team has also reportedly taken a 50 per cent pay cut. The founders have also tried to explain the layoffs by citing recession, Russia-Ukraine war and interest rate hikes, among other global headwinds. But the edtech space has largely been hit because of schools reopening and the pandemic demand for online learning fading away.
India’s startup ecosystem in pain
Among major players in the edtech space who thrived during the lockdown, Unacademy has also slashed its workforce by 10 per cent, while Byju’s has gone ahead with the largest job cut affecting 2,500 people. Other than edtech, other names such as Oyo and Zomato in the startup ecosystem, have also resorted to layoffs, with Oyo firing 600 people recently.
