NEW DELHI: Within a fortnight of laying off 200 employees, edtech firm Vendantu has further fired 424 employees from the company citing tough external environment and fear of recession.
Vedantu, after laying off 200 employees, had shared it's plan of hiring 1,000 employees this year.
"Today I am writing about one of the toughest decisions we had to take in the past many years. It is days like these that are heartbreaking and I hope to never see them again."
"There is no easy way to say this -- out of 5,900 Vedans, 424 of our fellow teammates i.e. approximately 7 per cent of our company, will be parting with us," Vedantu co-founder and CEO Vamsi Krishna said in a blog post.
He said that the current external environment is tough and the company is going back to its operating principal, where it will look to create runway for 30 months and lower customer acquisition cost.
"War in Europe, impending recession fears and Fed interest rate 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," Krishna said.
He said that with COVID-19 tailwinds receding, schools and offline models opening up and the hyper growth of 9 times Vedantu experienced during the last 2 years will also get moderated.
Vamsi said that the company will have to adapt to situation for long term sustenance.
"The result is that a few teams and projects will have to be deprioritised, and in the process, a few of our Vedans will be let go as well. These calls are never easy to make, and let me also tell you, this is not a reflection of either the ability or the performance of the impacted Vedans in any way," Krishna said.
During this year edtech firms have laid off hundreds of their workforce.
In April, Unacademy had laid off around 600 people.
In February, Ronnie Screwvala-funded Lido Learning had shut shop, which reportedly led to loss of around 1,000 jobs.