The Unacademy Group has laid off employees from its core business, Unacademy, and PrepLadder
The startup confirmed that it has parted ways with around 150 employees, but refused to call it a layoff exercise as employees were on PIP
According to Inc42 layoff tracker, over 9,700 Indian startup employees have been impacted in 2022 alone
Edtech giant Unacademy Group has laid off over 150 employees in the past couple of days. The second-most valued edtech giant has laid off employees mostly from its sales and operations verticals, sources told Inc42.
The impacted employees are from Unacademy Group’s core business, Unacademy, and PrepLadder, the sources said.
The startup is said to be assisting the impacted employees with outplacement. Unacademy laid off the employees due to their “poor performance” as it is trying to improve its efficiency to become profitable.
The fresh layoffs come two months after Unacademy laid off 10% of its workforce or around 600 full-time and contractual employees across departments. However, Unacademy had then said that the layoffs were based on several assessments to determine role redundancy and performance.
Unacademy confirmed to Inc42 that it has parted ways with around 150 employees, but refused to call it a layoff exercise.
In a statement, the edtech unicorn said, “Unacademy has not conducted any layoffs, and we strongly deny the information as it is factually incorrect. The company is built on a culture of high performance and transparency, and a key aspect of that is the transparency and objectivity of our performance appraisal process. Based on the outcome of the recent appraisal, a very small fraction of the workforce (~2.6%) was put on a performance improvement program, as is common for any organisation of our size and scale. The departure of these employees is a result of the PIP, which is a standard practice in all organisations.”
Unacademy has offered two-month salary as part of the severance package, along with additional medical insurance/coverage till mid of July, the sources added.
Edtech Startups Face Litmus Test
Since the beginning of 2022, the edtech sector, which grew exponentially in the last two years due to the pandemic, has been making headlines for all the wrong reasons. The sector, which had raised billions of dollars in the last two years, has been hit by a series of layoffs across startups.
It all started with Ronnie Screwvala-backed Lido Learning laying off a majority of its employees as it was unable to pay their salaries and was on the verge of shutting down.
The layoffs soon hit edtech giants such as Unacademy and Vedantu as well. While Vedantu had laid off around 624 employees till now this year, Gaurav Munjal’s edtech unicorn Unacademy has laid off around 1,100 employees, including the latest 150 employees. Besides, Alpha Wave-backed edtech startup Udayy shut down its operations in April this year, while non-academic upskilling platform FrontRow laid off 30% of its workforce, or 145 employees.
Overall, about 9,700 Indian startup employees have been impacted due to layoffs in 2022, data from Inc42 layoff tracker shows.
It must be noted that the latest layoffs have come at a time when on one side — Unacademy has launched its new product – Cohesive, a platform that offers a software development environment for product teams to test and deploy code, and on the other side, it has shutdown Mastree last year and will be pulling the plug from K12 business as per media reports.
If we talk about the financials of Unacademy, the startup has seen its loss soar by 494% to INR 1,537 Cr in FY21, while recording sales worth INR 397.6 Cr. The startup had then incurred an expenditure of INR 2,029.9 Cr