The layoffs at Skill-Lync, which has a headcount of over 2,000, impacted employees from sales, marketing, tech, talent acquisition teams, among others
In an internal mail, cofounder SuryaNarayanan PaneerSelvam attributed the layoffs to the “recent macroeconomic conditions”
Skill-Lync has been struggling with a funding crunch and let go of 300-400 employees ahead of the latest layoffs, citing their performance
Chennai-headquartered upskilling startup Skill-Lync, which provides job opportunities to students upon completion of the programme, has become the latest edtech startup to layoff employees due to a funding crunch.
The startup, which has a headcount of over 2,000 as per its LinkedIn page, fired over 400 employees last week in a restructuring exercise, sources told Inc42.
Skill-Lync cofounder SuryaNarayanan PaneerSelvam informed the employees about the layoffs in an internal mail and attributed it to the “recent macroeconomic conditions”. Inc42 has accessed the mail sent by PaneerSelvam.
“This doesn’t reflect in any way on the performance of the individual,” the cofounder wrote in the mail.
The impacted employees were from sales, marketing, pre-sales, tech and talent acquisition departments. The startup offered severance packages to the laid off employees based on their respective notice periods.
Besides, Skill-Lync also closed the shutters of its Delhi NCR office post the latest layoff round, the sources told Inc42. Earlier, it had closed its Mumbai and Pune offices and let go of around 300-400 employees, sources added.
The startup confirmed the latest layoffs to Inc42 in a statement. “Given the macroeconomic conditions, we’ve decided to moderate our growth expectations and slow down some of our projects focused on the future. In the existing business, we have changed our delivery model to provide better learning outcomes using a combination of technology and experts – This led to some role redundancy,” PaneerSelvam said in the statement.
“We’ve decided to consolidate our operations across Chennai, Bengaluru and Hyderabad, with only corporate-facing teams operating from Pune/Delhi which further led to some headcount reduction. We’ve also reduced the hierarchy in our organisation for more agile decision making and accountability,” he added.
Winter Blues: Edtech Startup Suffer From Funding Shortage
As per the sources, Skill-Lync has been struggling with a capital shortage, amid the ongoing funding winter, since November last year.
In an email sent by PaneerSelvam in November 2022, the cofounder said that the startup had INR 120 Cr in bank. Meanwhile, its expenses stood at INR 35 Cr per month and revenue at INR 26 Cr, the sources added. However, Inc42 couldn’t independently verify this.
Amidst this, the startup put a large number of employees from its sales and pre-sales team on a performance improvement plan (PIP) in November 2022 and gave them “impossible” targets, according to the sources.
Upon completion of the PIP period, a large number of employees were let go late last year and at the beginning of 2023 based on their performance. Later, the startup fired its entire L&D and quality teams, the sources said.
Overall, around 300-400 employees were sacked before April on the grounds of performance, ahead of the latest layoff round.
One of the sources said that Skill-Lync has been struggling to get new customers. “The core product is overpriced. Why will customers come to us when they can get the same offerings at half the price with a promise of a job?” the source said.
Skill-Lync, founded in 2015 by PaneerSelvam and Sarangarajan V, directly competes against the likes of Great Learning, Info Edge-backed Coding Ninjas, Hero Vired, Pesto Tech and Scaler Academy. It offers upskilling courses online as well as offline. The startup offers a 8-12 month online master’s course and a shorter six-month program for offline learners.
However, it has been reeling under mounting losses. In FY22, its net loss jumped 6X to INR 140 Cr from INR 24 Cr in the previous year. Revenue from operations rose 3X to INR 46.7 Cr from INR 15.9 Cr in FY21.
Skill-Lync last raised $17.5 Mn in its Series A round led by Iron Pillar in August 2021. The funding round also saw participation from existing investors Y Combinator and Better Capital. Earlier, it also received funding from Flipkart cofounder Binny Bansal.
Interestingly, Skill-Lync also acquired online learning platform Crio for an undisclosed amount in November last year.
The edtech sector is one of the worst hit by the ongoing funding winter. Since the beginning of 2022, 19 edtech startups, including unicorns like BYJU’S, Unacademy, and Vedantu, have sacked over 9,000 employees.