Hi, this is Pranav Mukul in New Delhi.
At the end of last year, ETtech’s State of Startup Survey 2022, a survey of the most influential founders and investors, churned out a clear message—conserve cash, cut burn and turn profitable. Two-thirds of the respondents last year predicted that Indian startups will lay off employees in big numbers. And that’s exactly what happened. (Look out for this year’s survey results next week!)
Startups laid off over 28,000 people just in the first three quarters of 2023. This alone was over 50% higher than 2022, when companies let go nearly 18,000 employees as they underwent restructuring. Tech giants like Google, Amazon and Meta, also handed out pink slips to employees.
The aftermath: A section of startups, particularly early-stage companies, view layoffs as a much-needed correction in the job market. “It became terribly difficult in the boom period of 2020 and 2021 to attract talent…larger, well-funded companies were giving offers for lateral hires that were difficult for us to match,” a founder at a Gurgaon-based early-stage startup told ETtech. The founder said with the market cooling down, it had become relatively easier to hire non-tech talent even as tech talent remains expensive.
“In roles such as human resources, finance, business operations, sales, things became better…a lot of employees in these profiles were moving out of the startup industry fully but other than that there was a running supply of talent available,” he said.
What’s ahead? Earlier this week, we wrote about how India’s IT sector is expected to onboard 32% fewer engineering graduates in the ongoing fiscal year compared to FY23, according to a report by TeamLease Digital. This means 1.55 lakh freshers may be hired in the IT/technology sector this fiscal as compared to 2.3 lakh last year. The tech sector is witnessing a shift towards re-skilling and upskilling, with generative AI at the frontier for employees.
Layoffs and Pink Slips
28K and counting: That’s the 2023 layoff data from startup land | New-economy companies laid off more than 28,000 employees in the first three quarters of 2023.
Udaan lays off over 100 employees shortly after $340 million fundraise: Business-to-business (B2B) ecommerce company Udaan on Monday laid off 100 to 120 employees, about 10% of its workforce, days after raising $340 million in a funding round.
ShareChat cuts 200 jobs in third round of layoffs this year: Vernacular social media platform ShareChat on Wednesday said it laid off 15% of its staff, or 200 employees, in a bid to streamline costs and achieve profitability within the next 4-6 quarters.
Top Stories This Week
At AGM, Byju’s investors press for transparency from founder: Investors prodded Byju’s founder Byju Raveendran to ensure full transparency about company financials and the latest state of affairs at the edtech firm at its annual general meeting, according to people present at the meeting.
Also read | Byju’s board clears FY22 financial accounts, reappoints BDO as auditor at AGM
Flipkart in talks to raise $1 billion, Walmart commits $600 million: Ecommerce major Flipkart is in talks to raise as much as $1 billion, with parent Walmart committing to inject $600 million, said people aware of the matter. This would be the first fundraise for India’s largest online retailer since 2021 when it closed a $3.6 billion funding round at a valuation of $37.6 billion.
Ola Electric files draft IPO papers, looks to raise Rs 5,500 crore via fresh share sale: Ola Electric has filed its draft red herring prospectus (DRHP) with the Securities and Exchange Board of India (Sebi). The company is looking to raise up to Rs 5,500 crore through fresh issue of shares, with an offer-for-sale (OFS) component of 95.2 million shares.
SoftBank-backed FirstCry set to file for IPO, eyes $500-600 million raise: After last year’s postponement, omnichannel retailer FirstCry is looking to file its draft IPO papers in the next few days, said people with knowledge of the matter. It is aiming to raise $500-600 million.
Also read | Footpath Ventures may pick a stake in Rajasthan Royals
PhonePe explored investment in Dunzo’s merchant business: Walmart-backed PhonePe recently made an offer to cash-strapped Dunzo to invest a significant amount in its merchant network business.
Fintech Corner
Razorpay, Cashfree secure RBI nod for payment aggregator business: Digital payment startups Razorpay and Cashfree have received the final approval from the Reserve Bank of India (RBI) to operate as payment aggregators after nearly a year-long embargo, paving the way for them to add new merchants and accelerate growth.
As RBI lifts curbs, Razorpay, Cashfree eye lost market share: Now that they have got the payment aggregator licence, Razorpay and Cashfree are trying everything to win back merchants.
UPI AutoPay top of charts in low-ticket recurring payments: The Unified Payments Interface (UPI) is steadily gaining popularity for bill and subscription payments, with a bulk of low-value recurring transactions moving to UPI AutoPay.
BharatPe to take unlisted NCD route to raise Rs 500 crore: New Delhi-based BharatPe is looking to raise Rs 500 crore of debt through unlisted non-convertible debentures (NCDs), multiple people aware of the discussions told ET.
Earnings Corner
Euler Motors net loss jumps five-fold in FY23: Euler Motors, which manufactures and sells three-wheeled electric commercial vehicles, posted a wider net loss of Rs 175 crore in fiscal 2023 compared with Rs 36 crore the previous year.
Also read | Beauty brand Plum’s FY23 revenue rises 71% to Rs 322 crore
HealthKart revenue grows 69% in FY23: Omnichannel nutrition products retailer HealthKart reported a 69.5% year-on-year rise in operating revenue to Rs 832.48 crore during the fiscal year ended March 31, while its net loss nearly halved to Rs 164.71 crore.
Zupee’s FY23 operating revenue more than doubles: Matrix Partners-backed online real-money gaming startup Zupee has more than doubled operating revenue to Rs 831.51 crore in FY23, from Rs 405.10 crore in the previous year..
NFT platform Rario’s FY23 losses widen more than ten-fold: Rario, a cricket-focused non-fungible tokens (NFTs) platform, reported an over ten-fold increase in losses to Rs 560 crore in the fiscal year ending March 2023, partly due to a write-off of intangible assets amounting to Rs 458 crore related to its NFTs.
Also read | Beauty brand Pilgrim’s revenue grows four-fold, losses triple
ETtech Deals Digest: Indian startups raised $908 million this week buoyed by Flipkart’s mega funding
Hi, this is Pranav Mukul in New Delhi.
At the end of last year, ETtech’s State of Startup Survey 2022, a survey of the most influential founders and investors, churned out a clear message—conserve cash, cut burn and turn profitable. Two-thirds of the respondents last year predicted that Indian startups will lay off employees in big numbers. And that’s exactly what happened. (Look out for this year’s survey results next week!)
Startups laid off over 28,000 people just in the first three quarters of 2023. This alone was over 50% higher than 2022, when companies let go nearly 18,000 employees as they underwent restructuring. Tech giants like Google, Amazon and Meta, also handed out pink slips to employees.
The aftermath: A section of startups, particularly early-stage companies, view layoffs as a much-needed correction in the job market. “It became terribly difficult in the boom period of 2020 and 2021 to attract talent…larger, well-funded companies were giving offers for lateral hires that were difficult for us to match,” a founder at a Gurgaon-based early-stage startup told ETtech. The founder said with the market cooling down, it had become relatively easier to hire non-tech talent even as tech talent remains expensive.
“In roles such as human resources, finance, business operations, sales, things became better…a lot of employees in these profiles were moving out of the startup industry fully but other than that there was a running supply of talent available,” he said.
What’s ahead? Earlier this week, we wrote about how India’s IT sector is expected to onboard 32% fewer engineering graduates in the ongoing fiscal year compared to FY23, according to a report by TeamLease Digital. This means 1.55 lakh freshers may be hired in the IT/technology sector this fiscal as compared to 2.3 lakh last year. The tech sector is witnessing a shift towards re-skilling and upskilling, with generative AI at the frontier for employees.
Layoffs and Pink Slips
28K and counting: That’s the 2023 layoff data from startup land | New-economy companies laid off more than 28,000 employees in the first three quarters of 2023.
Udaan lays off over 100 employees shortly after $340 million fundraise: Business-to-business (B2B) ecommerce company Udaan on Monday laid off 100 to 120 employees, about 10% of its workforce, days after raising $340 million in a funding round.
ShareChat cuts 200 jobs in third round of layoffs this year: Vernacular social media platform ShareChat on Wednesday said it laid off 15% of its staff, or 200 employees, in a bid to streamline costs and achieve profitability within the next 4-6 quarters.
Top Stories This Week
At AGM, Byju’s investors press for transparency from founder: Investors prodded Byju’s founder Byju Raveendran to ensure full transparency about company financials and the latest state of affairs at the edtech firm at its annual general meeting, according to people present at the meeting.
Also read | Byju’s board clears FY22 financial accounts, reappoints BDO as auditor at AGM
Flipkart in talks to raise $1 billion, Walmart commits $600 million: Ecommerce major Flipkart is in talks to raise as much as $1 billion, with parent Walmart committing to inject $600 million, said people aware of the matter. This would be the first fundraise for India’s largest online retailer since 2021 when it closed a $3.6 billion funding round at a valuation of $37.6 billion.
Ola Electric files draft IPO papers, looks to raise Rs 5,500 crore via fresh share sale: Ola Electric has filed its draft red herring prospectus (DRHP) with the Securities and Exchange Board of India (Sebi). The company is looking to raise up to Rs 5,500 crore through fresh issue of shares, with an offer-for-sale (OFS) component of 95.2 million shares.
SoftBank-backed FirstCry set to file for IPO, eyes $500-600 million raise: After last year’s postponement, omnichannel retailer FirstCry is looking to file its draft IPO papers in the next few days, said people with knowledge of the matter. It is aiming to raise $500-600 million.
Also read | Footpath Ventures may pick a stake in Rajasthan Royals
PhonePe explored investment in Dunzo’s merchant business: Walmart-backed PhonePe recently made an offer to cash-strapped Dunzo to invest a significant amount in its merchant network business.
Fintech Corner
Razorpay, Cashfree secure RBI nod for payment aggregator business: Digital payment startups Razorpay and Cashfree have received the final approval from the Reserve Bank of India (RBI) to operate as payment aggregators after nearly a year-long embargo, paving the way for them to add new merchants and accelerate growth.
As RBI lifts curbs, Razorpay, Cashfree eye lost market share: Now that they have got the payment aggregator licence, Razorpay and Cashfree are trying everything to win back merchants.
UPI AutoPay top of charts in low-ticket recurring payments: The Unified Payments Interface (UPI) is steadily gaining popularity for bill and subscription payments, with a bulk of low-value recurring transactions moving to UPI AutoPay.
BharatPe to take unlisted NCD route to raise Rs 500 crore: New Delhi-based BharatPe is looking to raise Rs 500 crore of debt through unlisted non-convertible debentures (NCDs), multiple people aware of the discussions told ET.
Earnings Corner
Euler Motors net loss jumps five-fold in FY23: Euler Motors, which manufactures and sells three-wheeled electric commercial vehicles, posted a wider net loss of Rs 175 crore in fiscal 2023 compared with Rs 36 crore the previous year.
Also read | Beauty brand Plum’s FY23 revenue rises 71% to Rs 322 crore
HealthKart revenue grows 69% in FY23: Omnichannel nutrition products retailer HealthKart reported a 69.5% year-on-year rise in operating revenue to Rs 832.48 crore during the fiscal year ended March 31, while its net loss nearly halved to Rs 164.71 crore.
Zupee’s FY23 operating revenue more than doubles: Matrix Partners-backed online real-money gaming startup Zupee has more than doubled operating revenue to Rs 831.51 crore in FY23, from Rs 405.10 crore in the previous year..
NFT platform Rario’s FY23 losses widen more than ten-fold: Rario, a cricket-focused non-fungible tokens (NFTs) platform, reported an over ten-fold increase in losses to Rs 560 crore in the fiscal year ending March 2023, partly due to a write-off of intangible assets amounting to Rs 458 crore related to its NFTs.
Also read | Beauty brand Pilgrim’s revenue grows four-fold, losses triple
ETtech Deals Digest: Indian startups raised $908 million this week buoyed by Flipkart’s mega funding