Tiger Global-Backed Insurtech Startup Plum To Lay Off 10% Employees

Bengaluru-based insurtech startup Plum is reportedly laying off 36 employees, or around 10% of its total workforce, as part of a cost-cutting exercise amid the uncertain economic environment.

The layoffs come after weeks after Plum’s founder Abhishek Poddar said that the startup planned to increase its employee base to 1,000 by FY23 or March 2023.

The development was first reported by Entrackr.

“Care for employees and their families is the ethos on which we have built Plum. However, the world – economic and otherwise – has changed drastically over the past six months. While our business, which lies at the intersection of two secular growth industries – insurance and healthcare – is well-positioned to weather such an uncertain environment, we do need to match the pace and quantum of our investments with the market’s realities,” Poddar was quoted as saying.

He added that the impacted employees will receive severance pay, healthcare benefits, well-being counselling, ESOP vesting and placement and career support.

Citing sources, the report said that Plum took several cost-cutting measures before deciding to lay off employees. The list of the employees to be laid off was supposed to be finalised by Wednesday (November 9).

Founded in 2019 by Poddar and Saurabh Arora, Plum is a B2B insurtech startup that works with SMEs and startups to provide insurance, healthcare and well-being benefits to employees. The startup has created underwriting and fraud detection algorithms that allow companies to benefit from group insurance.

According to its website, Plum works with the likes of Unacademy, Swiggy, Tinder, Meesho and others. In all, Plum claims to have more than 2,000 customers and is providing benefits to over 300K people.

The startup’s last funding round was its Series A round worth $15.6 Mn, which saw Tiger Global join the startup’s cap table. In all, the startup has raised $20.6 Mn so far.

It competes with the likes of Pazcare, Nova Benefits and Onsurity.

With the layoffs, Plum has become the 46th Indian startup to fire employees in 2022 and the second insurtech startup to do so. In June this year, insuretech startup Nova Benefits laid off 80 employees across two separate rounds.

According to Inc42’s ‘Indian Startup Layoff Tracker’, over 16,000 employees have been laid off so far in 2022.

The ongoing funding winter has impacted the entire Indian startup ecosystem, however, none of the sectors has borne as much brunt as edtech.

Edtech startups account for nearly half of the total layoffs in 2022, as the opening up of schools and coaching centres post-pandemic hit the revenue of the startups in the sector. The increased competition coupled with a lack of liquidity has seen 14 edtech startups lay off 7,248 employees, while five edtech startups have shut down.