Tiger Global-backed Vedantu has joined edtech unicorns such as Byju's and Unacademy in laying off employees, as reports suggest that the startup has fired 385 of its employees, which comprises 11.6% of its workforce.
This is Vedantu's fourth round of layoffs as more than 7,000 employees have been shown the door in the edtech market so far in 2022.
Vedantu's tryst with laying off its employees started off with its action in May 2022 of firing 624 employees, followed by 100 workers in August.
In order to cut costs, the unicorn's founders team, including its CXOs have reportedly taken a 50% pay cut.
Vedantu, which was founded in 2011 by Vamsi Krishna, Anand Prakash, and Pulkit Jain, raised $100 million (Rs 740 crore) in its Series E round, which was headed by Singapore-based impact investor ABC World Asia, in September of last year, turning it into a unicorn.
Other investors for the company include Legend Capital, Omidyar Network GGV Capital, WestBridge Capital, Accel, and TAL Education.
Vedantu had recently acquired a major stake in Deeksha, a test preparation platform in October 2022. The $40 million dollar deal was aimed at bringing together Vedantu's technology with Deeksha's offline centres in order to create hybrid digital classrooms.
The layoffs are proving to be a pattern among edtech's biggest unicorns.
Byju's, in an email to its employees in November 2022 mentioned its decision to fire 2,500 employees, which make up about 5% of its workforce, over its efforts to focus on profitability.
Gaurav Munjal-led Unacademy cut about 350 jobs in November 2022 as part of the company's cost-cutting efforts.
Majority of the Edtech companies have defended the layoffs to be a result of cost cutting measures and restructuring. According to industry estimates, 45% of the 15,000+ layoffs that the start-up ecosystem has seen this year is being attributed to the Edtech industry, according to Peoplematters, a leading Human Resource website.
Macroeconomic developments like a combination of slowdown and lack of profitability, also lead start-ups like Ronnie Screwwala-backed Lido Learning, Crejo.Fun, Udayy and SuperLearn to shut down.
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