Amid a capital crunch creeping into the market, celebrity-focused online education platform FrontRow has fired 145 employees via email, according to reports.
Citing the funding crunch, EdTech has laid off nearly 30% of its full-time and contract employees.
Reports said Front Row has fired staff to increase efficiency and lengthen its runway. The company said most of the layoffs were from its sales and business development teams.
Over the past five months, Indian startups have laid off more than 6,000 employees. Himself, co-founder of Glamyo Health, Archit Garg estimates startup hairdos at 10 times the current number of around 60,000.
Some of India’s famous startups, including Unacademy, Cars24, Vedanta, Meesho, Trell, Furlenco and many others have shed more than 5,000 employees in India.
Most of the employees laid off by the companies claimed that they were asked to leave without any prior notice.
“Start-up founders may find it difficult to raise money in the coming months”
Industry players have seen that startup founders will find it difficult to raise funds with attractive valuations in the coming months.
During a joint program with Meta, formerly known as Facebook, Kalaari Capital founder and managing director Fanny Kula said customers may delay their buying decisions and startup founders will need to tighten their belts and look for alternative business opportunities.
“There will be a period when clients delay certain types of decision-making, but there may be other decisions that they make. I really think, in addition to that excessive liquidity, money will flow into the public markets, as we recently celebrated our 100th rhino day, any Of those 100 rhinos today, if they had to raise capital, they’d probably get 30 percent if not 50 percent.”
Kula said she has experienced four to five financial downturns, and whenever major shifts occur, opportunities open up and challenges emerge as well. It was seconded by Ajit Mohan, Vice President and General Manager of Meta in India, who said the days are coming as access to capital may become difficult.
“I really see this moment where the capital could be hard, at least for the next few months, maybe more, but it opens many other windows including the opportunity to solve problems more deeply, take the time to sort of fit the product into the market” Mohan said.
He said there will be a little less competition for talent compared to the situation in the past two years.
“This is a huge opportunity to build the right teams, I think if other companies don’t scale into anything, this is a chance for you to go and grab some of the best people out there,” Mohan said.
Meta has announced a partnership with Kalaari Capital to improve skills and expand the reach of young businesses investing in the SME sector by providing them with timely business skills support.
The partnership is part of the Meta VC Brand Incubator Initiative, the industry’s first program to build an ecosystem for the growth of small businesses in the country along with leading venture capital funds.
“We have a very diverse group of people and whether that’s culturally distinct, or whether they’re at different income levels, so, you know, the point we keep hearing is when you solve for India, you solve for the world,” Mohan said. This is somewhat true because India looks more like the world than any other country.