Unacademy, an Indian ed-tech startup that provides online learning services, has recently announced its fourth round of layoffs, which will result in around 12 per cent of its workforce being let go, or approximately 380 employees. This comes as the company, the second-most valued startup in the Indian tech industry, aims to make its core business profitable.
In a message sent to all employees via the company’s Slack channel, Unacademy’s co-founder and CEO, Gaurav Munjal, acknowledged that the company had taken steps to improve profitability but needed to be more. Munjal stated they must go deeper and take further action to ensure the company’s success.
The decision to implement another round of layoffs is likely a strategic move aimed at reducing costs and streamlining operations. While Unacademy has seen significant growth and success in recent years, including raising over $440 million in funding from investors such as SoftBank, its profitability has remained elusive. The company’s aggressive expansion and acquisition strategies have also been met with some criticism, leading to concerns about sustainability and the long-term viability of the business.
Unacademy is a major player in list of startups
Despite these challenges, Unacademy remains a major player in the Indian ed-tech market, offering a wide range of live classes, pre-recorded video lessons, and test preparation materials. The company has also recently announced plans to expand into K-12 education, which will fuel further growth in the coming years.
Gaurav Munjal added, “Unfortunately, this has led me to take another difficult decision. We will be reducing the size of our team by 12 per cent to ensure that we can meet the goals we are chasing in the current realities we face. I did not anticipate I would have to do this again, and I’m very sorry.”
Fourth round of Layoffs in 12 months
Unacademy, an Indian ed-tech startup, has implemented its fourth round of layoffs, which comes only four months after the company’s previous layoff round, where around 350 employees, or about 10 per cent of its staff, were let go in November. As a result of these actions, Unacademy’s team size has significantly reduced from more than 6,000 in April 2022 to under 3,000 at present. This move is part of the company’s efforts to make its core business profitable and achieve long-term success in the competitive ed-tech market.
According to Munjal’s statement, affected workers will get severance compensation equal to the notice period, an extra month’s pay, and accelerated vesting of one year for those who have worked for the business for at least a year. The firm also expects slower growth in the current fiscal year, which might put pressure on its value, mainly because one of its main rivals, PhysicsWallah, plans to grow by six times this year and is seeking to raise at least $250 million at a valuation of $3.3 billion.