Why Unacademy Will Cut 10 Percent of Employees in Second Round of Layoffs
Unacademy, the Indian online education company, will cut 10 percent of its workforce due to “difficult economic conditions”, the company told employees in a letter on Monday, its second round of layoffs this year. Softbank-backed Unacademy has tried to curb spending on marketing and control operating costs but it’s not enough, founder and CEO Gaurav Munjal said in the letter, seen by Reuters.
The Bengaluru-based company employs about 3,500 people, so 350 workers will be affected in this phase of layoffs, a source at the company told Reuters on condition of anonymity because they are not authorized to speak to the media on the matter.
“Subsidy has dropped dramatically and a large portion of our business has been taken off the Internet,” Munjal said in the letter.
A spokesman for Unacademy did not immediately respond to a request for comment from Reuters.
Unacademy, founded in 2015 and backed by Softbank among other investors, cut more than 600 jobs in April this year, local media reported at the time.
“We pledged that we would not be dismissed from the organization but the challenges of the market forced us to reevaluate our decisions,” said Munjal in the letter.
Back in July, the government warned ed-tech companies about unfair business practices in India. In a meeting with the industry body India Edtech Consortium (IEC), the Consumer Affairs Secretary said stricter guidelines will have to be worked out to ensure transparency if self-regulation does not curb unfair trading practices in the sector.
Ed-tech platforms received a lot of attention during the initial phase of the COVID-19 pandemic as schools and colleges were closed due to school closures. But the growing acceptance later revealed gaps to be filled in the field.
© Thomson Reuters 2022