SUMMARY
Mohalla Tech shut down its fantasy gaming platform Jeet11 last month, which resulted in 100 employees being fired
The latest round of layoffs at Mohalla Tech take the total employees fired by the Bengaluru-based company to 600
Mohalla Tech recorded a loss of INR 2,498.6 Cr in FY22, a jump of almost 2.1X from INR 1,183.6 Cr in FY21
Mohalla Tech Private Ltd, the parent company of vernacular content platforms Sharechat and Moj, has fired 500 employees, or about 20% of its staff.
It was not immediately clear which departments have been impacted by the layoffs within the content unicorn.
The development comes off the back of Mohalla Tech shutting down its fantasy gaming platform Jeet11 last month, which resulted in 100 employees being fired.
The latest round of layoffs at Mohalla Tech take the total employees fired by the Bengaluru-based company to 600.
Confirming the development, a Sharechat spokesperson said in a statement, “We’ve had to take some of the most difficult and painful decisions in our history as a company and had to let go of around 20% of our incredibly talented employees who have been with us in this startup journey.”
The spokesperson added, “The decision to reduce employee costs was taken after much deliberation and in light of the growing market consensus that investment sentiments will remain very cautious throughout this year.”
Sharechat said that it will double down on live streaming and advertising revenues.
The impacted employees will be receiving the entire salary of their notice periods, two-weeks’ pay for each year served with the company and 100% of the variable pay till December 2022. Also, the company will allow impacted employees to encash unused leave balance of up to 45 days.
The Sharechat and Moj parent will also be extending the health insurance cover till June-end 2023 and allow impacted employees to keep their work assets, such as laptops.
The content unicorn added that the employee stock option plans (ESOPs) will continue to vest till April 30, 2023, with the impacted employees retaining all of their vested ESOPs.
Mohalla Tech recorded a loss of INR 2,498.6 Cr in FY22, excluding non-operating losses of INR 490 Cr, a jump of almost 2.1X from INR 1,183.6 Cr in FY21. At the same time, its revenue went from INR 80.4 Cr in FY21 to INR 419.2 Cr in FY22, a rise of 4.3X.
The Sharechat and Moj parent has raised $1.4 Bn from investors such as Times Group, Google, Tiger Global, LightSpeed, Twitter, Temasek and Moore Strategic Ventures, among others. The startup’s last valuation stood at $5 Bn.
While 2022 saw more than 18,000 employees being fired as a funding winter fell on the Indian startup ecosystem, it seems that the firings will continue for at least the next two quarters.
