Social media platform ShareChat today fired around 200 employees in a second round of layoffs
As per the sources, the employees were informed about the restructuring exercise today in a one-on-one call with the management team.
The layoff exercise came almost 11 months after ShareChat fired around 500 employees, or about 20% of its workforce.
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Social media platform ShareChat today fired around 200 employees in a second round of layoffs this year to cut costs, sources told Inc42.
The startup confirmed the development with Inc42. In a statement, it said that the “comprehensive restructuring effort”, which resulted in reduction in its team size by about 15%, was aimed at streamlining operations, enhancing productivity, and positioning the company for sustainable growth.
“ShareChat, today undertook a strategic restructuring as part of its annual planning for the year 2024. The decision reflects the company’s commitment to streamlining its cost base and achieving profitability within the next 4-6 quarters,” the statement said.
However, the startup did not disclose the severance pay that will be paid to the impacted employees.
As per the sources, the employees were informed about the restructuring exercise today in a one-on-one call with the management team.
The layoff exercise came almost 11 months after ShareChat fired around 500 employees, or about 20% of its workforce.
As per the EPFO portal, the startup credited PF amount for 1,281 employees in November 2023 as compared to 2,346 employees in November 2022.
The retrenchments in January this year came on the back of ShareChat parent Mohalla Tech shutting down its fantasy gaming platform Jeet11 in December 2022, which resulted in 100 employees losing their jobs.
In January this year, two of ShareChat’s cofounders – Bhanu Pratap Singh and Farid Ahsan – also resigned. Following this, they founded a robotics startup General Autonomy and raised $3 Mn seed funding for it last month from venture capital firms India Quotient and Elevation Capital.
Besides, the founder exits and employee layoffs, ShareChat is also struggling to raise capital. As per a TechCrunch report, the startup is in talks to raise a much needed $50 Mn at a valuation under $1.5 Bn. In March last year, the startup touched the peak valuation of $5 Bn after adding Temasek to its captable. As of date, ShareChat has raised a total of $1.7 Bn in funding across multiple rounds and counts the likes of Lightspeed Ventures, Twitter, and Google among its backers.
ShareChat’s net loss jumped 38.17% to INR 4,064.31 Cr in FY23 from INR 2,941.51 Cr in the previous fiscal year. The bottom line took a hit despite its operating revenue surging 62% to INR 540.21 Cr from INR 332.69 Cr in FY22.
Meanwhile, its total income increased 54.90% to INR 628.85 Cr from INR 405.96 Cr in FY22. Effectively, it spent INR 7.46 to earn every rupee in FY23.
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