Due to “tough economic conditions,” Unacademy, an Indian online education startup, will lay off 10% of its workers, it announced in a letter to employees on Monday. This is the company’s second wave of layoffs this year. Founder and CEO Gaurav Munjal claimed in the letter, which was seen by Reuters, that despite efforts to reduce marketing expenses and operational expenditures, Unacademy, which is backed by Softbank, had not been successful.
350 employees would be impacted by this round of layoffs at the Bengaluru-based company, according to a source who spoke to Reuters on the condition of anonymity because they were not authorised to discuss the situation with the media.
In the letter, Munjal stated that “funding has significantly slowed down and a large portion of our core business has moved offline.”
Reuters contacted Unacademy for comment, but no one from the company responded right away. Local media at the time stated that Unacademy, which was founded in 2015 and had investment from Softbank as well as other investors, had slashed more than 600 jobs.
The letter from Munjal stated, “We made a vow of no layoffs in the organisation but the market circumstances have compelled us to reassess our actions.
The government issued a warning to ed-tech businesses in July on unfair commercial practices in India. The consumer affairs secretary stated in a meeting with the industry group India Edtech Consortium (IEC) that strict regulations would need to be developed to ensure transparency if self-regulation does not stop the unfair business practices in the industry.
As schools and universities were forced to close owing to lockdowns during the early stages of the COVID-19 outbreak, ed-tech platforms received enormous attention. But as usage increased, it became clearer which gaps in the market still needed to be filled.