Edtech Unicorn Unacademy Lays Off 600 Employees To Cut Costs
India’s second largest edtech platform Unacademy has laid off part of its workforce as the SoftBank-backed startup looks to cut costs.
“Based on the outcome of several assessments, a small subset of employee, contractor, and educator roles were reevaluated due to role redundancy and performance, as is common for any organization of our size and scale,” the Bengaluru-based company told BloombergQuint over a WhatsApp message. Less than 10% of the workforce has been laid off, it said.
While the company didn't disclose the actual number, two people with knowledge of the matter said on the condition of anonymity that around 600 employees were laid off.
The company spokesperson said that Unacademy is focused on becoming profitable and more efficient by the end of the 2022 in their core business, while investing for growth in their group companies.
The startup valued at $3.4 billion, along with Byjus and other edtech companies, witnessed a massive funding spree on the back of unprecedented demand during the Covid-19 pandemic, as schools and colleges remained shut due to lockdown restrictions.
Unacademy had raised $440 million led by Temasek in August 2021, that saw its valuation rise 10 times.
"We are extremely bullish about our core test-prep business and in the growth of our group companies Relevel, PrepLadder, and Graphy. Our test-prep business is growing over 50% year-over-year, and our Ebitda percentage is also getting better," the spokesperson said.
The company has discussed and parted ways with people, in accordance with their respective contracts, the spokesperson said. "Further, the company has in good faith ensured they receive certain additional benefits and a generous severance."