Of the 300 employees impacted by the layoffs, around 200 were from Tekion’s India offices, sources told Inc42
Tekion confirmed the layoffs to Inc42 and cited “changing macroeconomic conditions” as the reason behind it
Tekion, founded by former Tesla CIO Jay Vijayan, last raised $250 Mn in a funding round in 2021, which tripled its valuation to $3.5 Bn
California headquartered SaaS automation startup Tekion laid off around 300 employees, or 10% of its workforce, earlier this week as part of a cost-cutting exercise, sources told Inc42.
Of the 300 employees impacted by the layoffs, around 200 were from Tekion’s India office, the sources added.
The startup has offices in Bengaluru and Chennai and has a majority of its employees in India.
In a town hall meeting on Monday (July 31), Tekion’s leadership team informed the employees that the startup would be conducting a restructuring exercise which would result in job cuts. Following the meeting, the impacted employees received mails about the layoffs, the sources said.
The layoffs impacted employees from teams such as tech, sales, marketing, talent acquisition, human resources, among others, as per the sources.
Tekion confirmed the layoffs to Inc42 and hinted at “changing macroeconomic conditions” as the reason behind it. However, it didn’t comment on the number of employees who lost their jobs in the restructuring exercise.
“Building a large-scale business while keeping our mission intact requires us to make tough, but important business decisions; mainly organisational adjustments to navigate through changing macroeconomic conditions,” Marylou Hastert, vice-president of marketing at Tekion, told Inc42 in a statement.
“This week, we have made the difficult decision to reduce a small percentage of our workforce in some areas of the business. We deeply empathise with these impacted colleagues and are working to support them with their career transitions with severance pay, outplacement assistance, and additional support through our Employee Assistance Program,” Hastert added.
Sources told Inc42 that Tekion failed to achieve the revenue targets which it projected to its investors earlier and this was the main reason behind the layoffs. Besides, the startup is also rebuilding some of its products as they failed to generate revenue, they added.
Amid all these, Tekion also lost many of its clients over the last few months, as per the sources. The layoffs comes on the heels of Tekion acquiring interstate and state vehicle registration solution provider Five64.
Founded by former Tesla CIO Jay Vijayan in 2016, Tekion is a cloud-native SaaS platform that uses machine learning and artificial intelligence to bring together original equipment manufacturers (OEMs), retailers/dealers and consumers on a single platform. The startup offers an end-to-end dealer management system, where dealers can review vehicle inventory and service department metrics.
The latest development comes almost 1.5 years after Tekion raised $250 Mn in a funding round, which tripled its valuation to $3.5 Bn. The funding round was co-led by Alkeon Capital and Durable Capital.
Tekion entered the coveted unicorn club in 2020 after it bagged $150 Mn from Index Ventures, Exor, the holding company of Ferrari, and FM Capital, among others.
The startup has raised a total funding of $435 Mn till date and counts Hyundai Motor Company, General Motors, and BMW i Ventures among its backers.
The startup claims to work with lead vehicle manufacturers such as Lamborghini, Lexus, Mercedes Benz, Aston Martin, Lyft, among others.
The development comes at a time when multiple SaaS startups have laid off employees in the recent past amid the ongoing funding winter. Earlier this week, Inc42 exclusively reported that Increff laid off around 20% of its workforce. Prior to that Suumit Shah-led Dukaan laid off 30% of its workforce.
Amid macroeconomic headwinds and global economic slowdown, many global giants such as Google, Meta, Microsoft, and X (earlier known as Twitter) also undertook layoff exercises over the last year or so which resulted in many employees in their Indian offices also losing jobs.