BENGALURU: Edtech unicorn Vedantu has laid off 385 employees across HR and content, among other verticals. According to sources, this move is to reduce excess burn and to prioritise profitability.
So far, Tiger Global-backed edtech company has laid off 1,000 employees in 2022 alone. Sources confirmed that over 1,000 employees have been sacked, and also, the leadership team including founders will take a 50% pay cut.
Over 600 employees were laid off in May and in August about 100 employees were asked to leave the edtech unicorn.Two months ago, Vedantu acquired a majority stake in test preparation platform Deeksha for about $40 million, and with this acquisition, the company has been aiming to expand its hybrid model. After this acquisition, Vedantu had to cut down other expenditures, sources added. In May, the company officially confirmed it fired 7% of its workforce or about 424 employees as it is expecting fund shortage in coming quarters.
Its co-founder and CEO Vamsi Krishna had told employees that currently, the external environment is tough. “War in Europe, impending recession fears, and Fed rate interest hikes have led to inflationary pressures with massive correction in stocks globally and in India as well. Given this environment, capital will be scarce for upcoming quarters,” he said.
The start-up had raised $100 million in September 2021, and it was valued at $1 billion. Edtech firms have been sacking employees citing funds crunch. After Byju’s announced firing of 2,500 employees, edtech major Unacademy said it will fire 10% of its workforce, close to 350 employees, in November. In an email to employees, Unacademy CEO Gaurav Munjal had said that funding has significantly slowed down.