Meesho, a popular e-commerce platform based in Bangalore, has recently announced that it will be letting go of 251 employees due to overhiring mistakes. This news comes as a surprise to many, as Meesho has been performing well in the highly competitive Indian e-commerce market.
The company cited “judgement errors in over-hiring ahead of the curve” as the reason for the layoffs. In an email to the employees, co-founder and CEO Vidit Aatrey said, “Our spans and layers were inflated, and this could have unintended consequences on our speed to execute. While we are confident that the Meesho business will stay strong, the economic reality is here to stay. We are now faced with the hard truth of aligning our people costs with the new decision, which included reducing the size of the Meesho workforce by 15%.”
In a statement by Meesho’s co-founder and CEO, Vidit Aatrey, he revealed that the company has been facing challenges in the last few quarters due to the global pandemic and the changing market dynamics. The company had aggressively hired in the past, leading to overstaffing in certain teams. This resulted in inefficiencies in operations and a strain on finances. In an effort to build a sustainable and profitable business, Aatrey believes that tough decisions need to be made.
The laid-off employees will receive severance pay and other benefits as per company policy. Meesho has also promised to assist these employees in finding new job opportunities through its network and partnerships.
The affected employees will be provided with a separation package that includes a one-time severance payment of 2.5 to nine months (depending on tenor and designation), continued insurance benefits, job placement support, and accelerated vesting of ESOPs. The departing employees can continue to use their official Gmail and Slack accounts until Sunday evening.
Meesho has become well-known for its unique business model, which allows individuals to start their own online businesses using the platform. The company has been successful in empowering women entrepreneurs in India and has expanded its reach to rural areas.
Despite the setback, Meesho remains optimistic about its future prospects. The company recently raised $300 million in a funding round led by SoftBank, which valued the company at $2.1 billion.
Aatrey remains committed to Meesho’s mission of creating opportunities for millions of entrepreneurs in India. He believes that by focusing on innovation and building a sustainable business model, Meesho can withstand any market challenges that come its way.
The news of Meesho’s layoffs has sparked discussions on social media about the challenges faced by startups in the current economic climate. Experts suggest that it is crucial for startups to have a clear hiring strategy and be mindful of their cash burn rate to ensure long-term success.
This news is a tough pill to swallow, but it is a necessary step toward building a sustainable and profitable business. Meesho’s commitment to supporting its affected employees and continuing its mission to empower entrepreneurs is commendable and sets an example for other startups in the industry.
In today’s fast-paced and ever-changing business world, it’s important to adapt to the changing market dynamics to stay relevant and competitive. Meesho’s decision to let go of employees shows that the company is taking proactive steps to ensure that it remains profitable and sustainable in the long run.
Despite the current economic climate, Meesho remains focused on its mission of empowering entrepreneurs and creating opportunities for millions of people in India. The company’s success and growth will be closely watched by industry experts and competitors alike, as they strive to stay ahead in the highly competitive e-commerce market.
In conclusion, Meesho’s decision to lay off employees may be tough, but it is a necessary move toward building a sustainable and profitable business. The company’s commitment to supporting its affected employees and continuing its mission to empower entrepreneurs is commendable and sets an example for other startups in the industry.
