The countrywide lockdown has further stretched the burden of survival on the Indian startups. With cost-cutting measures in place, several job cuts are already done, people are on temporary leave while others have been asked to take pay cuts. And this is not all, as the lockdown increases, there is another wave of layoffs expected in the next few months by the market watchers.
Right now, there are only two choices for business— either survive or save jobs. Either way, the costs are high. The debatable concern is that would you rather save jobs right now and risk losing the business entirely in the next few months or save the business right now at the cost of human capital?
It’s a real-life ‘Sophie’s Choice’ and there is no right or wrong answer, but each choice will lead businesses down a different path. So, every business is doing the best they can — revisiting costs and identifying the right cost to cut to stretch the runway.
As the ecosystem faces uncertainty about the future, there are companies resorting to various decisions to help in the crisis. Inc42 has compiled and verified the data of the pay cuts, layoffs and furloughs happening in the ecosystem directly from companies or our sources.
#Inc42 Exclusive | Limeroad Resorts To Pay Cuts, Ponders Furloughs
Fashion ecommerce platform Limeroad has undergone company-wide pay cuts and resorted to furloughs, Inc42 has learned. Suchi Mukherjee, CEO, Limeroad, confirmed the pay cuts saying founders have taken 100% deduction, while other employees have taken 10%-30% pay cuts. However, she said that the company has just discussed temporary leaves and hasn’t finalised anything yet.
#Inc42 Exclusive | Vakilsearch Cuts Jobs And Salaries
Vakilsearch, the online legal platform for tax, startup registrations and compliance, has laid-off some employees from its sales team, Inc42 has learned from sources. Sources said the company has also put in place salary-based pay cuts from 15%-30% across the organisation. The company is yet to confirm the same to us.
#Inc42 Exclusive | CleverTap Lays Off Employees To Cut Costs
Mobile marketing platform CleverTap has laid off around 60 employees, Inc42 has learned from sources close to the company. The layoffs have come across teams like design, engineering, marketing, product management etc. The company told employees that it is a cost-cutting measure and has given one-month severance pay. CleverTap spokesperson confirmed this to Inc42 saying that on April 16, 2020, CleverTap reduced employee headcount by 20% worldwide.
The company said it is offering enhanced severance benefits as well as outplacement services to these employees.
#Inc42 Exclusive | BulBul Enforces Pay Cuts
Social commerce platform BulBul has laid off 100 of its total 300 employees, Inc42 has learned. The source said that layoffs have been done across teams like inventory management, complaints management etc as the company’s deliveries are off currently. Further, the company has also put in place a 10% salary cut across the organization. Also, founders have taken 100% pay cut while senior management will take 1/3rd of their salary going forward. BulBul CEO Sachin Bhatia confirmed pay cuts to us but denied any layoffs.
Blackbuck Lays Off 200 Employees
Logistics tech unicorn BlackBuck is said to be laying off around 200 employees as the transport sector faces massive disruption due to the lockdown. The impacted departments are customer experience and operations teams. The company is trying to get several of the affected employees placed in other organisations.
Orange Something Shutters Down With Layoffs
Grofers’ has reportedly laid off around 70 employees from its side project of beauty and wellness products, Orange Something, and offline segment for three month months. Albinder Dhindsa, cofounder of Grofers, said that Orange Something had “stopped” operations and about 35 employees from that segment were moved to other functions in the company. Dhindsa claimed that the rest of the employees are on payroll with the reduced salary, but will get health benefits. The company said that Covid-19 outbreak has caused “unprecedented loss of opportunities” and hence the company has opted to place staffers on furlough for three months till mid-July.
Acko: Online insurance firm Acko has reportedly let go of around 50 employees across customer service, operation sales, and marketing teams. Acko founder Varun Dua said 45 people were “impacted”. The leadership team has taken deep voluntary salary cuts between 50% and 70% to do what’s right in the interest of the majority.
Capillary: Talking to Inc42, Capillary employees confirmed that the company has laid off 4-5 employees from each team for business continuity amid the crisis. The employees said that the company has laid off people from its various offices.
CreditMate: CreditMate cofounder and CEO Jonathan Bill said that the company has reduced salaries across the board to save costs. CreditMate has a total of 60 employees and is cutting its salary bill by up to 20%. Cofounder Bill said a 25% is mandatory for employees earning above INR 1 Lakh per month, with those employees not willing to take the pay cut asked to leave.
Droom: Droom CEO Sandeep Aggarwal confirmed the pay cuts for employees saying, “Everyone at Droom has taken a salary cut of 15%, at every level throughout the company, with effect from April 1.”
FabHotels: FabHotels laid off over 100 of its employees as a result of its ‘resource optimization’ exercise across operations, tech, sales and supply acquisition teams. While the founders will take a 25% pay cut, the company has instituted salary-based pay cuts ranging from 15%-20%.
Fareportal: Employees of US-based Fareportal in Gurugram were asked to resign recently. An employee told Inc42 that Fareportal sacked around 300 employees due to the “devastating effect” the coronavirus pandemic had on the tourism industry. The company has told them the employees will receive March’s salary along with 15 days basic salary in the FNF.
IndiaLends: IndiaLends has asked some employees to opt for leave without pay and others to take steep pay cuts as it looks to navigate the current economic crisis caused by the pandemic and the lockdown.
Instamojo: Instamojo cofounder and CEO Sampad Swain said that the company has downsized 6%-7% of its total workforce of 100 employees. “Pay cuts were implemented because the business was impacted due to COVID-19,” Swain added. Instamojo has implemented 10-40% company-wide pay cuts, of which the top management has taken the highest 40% cut.
Ixigo: At ixigo, founders have foregone their salary while employees have taken salary cuts to help the company overcome the loss in revenue to a certain degree and extend the runway till conditions improve for the travel sector.
Livspace: Livspace’s founder and CEO Anuj Srivastava said that as of now, there have been no COVID-related layoffs or salary reductions at Livspace. However, cofounders, Anuj Srivastava and Ramakant Sharma will forgo 70% of their entire year’s salary.
MakeMyTrip: MakeMyTrip began by reducing costs on the employees front and to set an example both founder Deep Kalra and group CEO Rajesh Magow have pledged to not take a salary effective April 2020. Rest of the leadership team at MMT have also offered to take approximately 50% in compensation.
Meesho: Meesho has laid off around 200 employees. About 40% of the company’s key account managers, all business relationship managers and about 30-40% of the business development team have been laid off.
OYO: OYO has asked thousands of employees to go on leave or furloughs for a period of up to three months as the company plans to dodge coronavirus’ impact on the revenue and occupancy of its hotel rooms. Further, founder and group CEO Ritesh Agarwal has foregone his salary for the year. The company’s executive leadership team has taken a voluntary pay cut starting at 25% to 50% from April 2020.
RateGain: B2B SaaS platform RateGain has sent hundreds of employees on temporary leave while several others have been asked to take pay cuts. The company said it has implemented salary reduction with the management team taking the greatest hit between 50%-100%. Further, the company says it sent some of its employees on furlough with an action plan to bring them back as soon as possible.
Shop101: Shop101 has asked nearly 40% of its total employees to resign while others have been asked to take pay cuts. The company had informed its employees on April 3 via a group call. A source within Shop101 said that out of total 400-500 employees, nearly 200 employees across teams have been asked to leave. The company also terminated nearly 100 contractual employees, who were involved in call centre operations.
Shuttl: Shuttl employees also told us that the company has laid off employees across teams, one of the being on-ground operations teams. The company had directed employees to resign, and those who didn’t have been terminated. Shuttl has claimed that it has laid off 40 employees.
TravelTriangle: TravelTriangle has reportedly announced layoffs of about 50% of its employees from operations, marketing, customer support and business development teams.
Treebo Hotels: Treebo Hotels offered a voluntary resignation option to 400 of its employees. Treebo CEO Sidharth Gupta told Inc42 that nearly 120 employees have taken up the scheme. Gupta added that the founders are taking a 60% salary cut and senior management is taking 40% salary cuts for at least three months.
Turtlemint: Online insurance marketplace Turtlemint has announced company-wide pay cuts ranging from 10%-30%.