Flush with new funds, Indian startups lead in sacking employees
The Covid-19 blow appears to have forced even those startups and unicorns that have managed to raise new funding go for a leaner workforce, firing employees in thousands.
 
Foodtech unicorn Swiggy, for example, raised almost Rs 1,185 crore this year as part of its Series -I round.
 
And yet, the company had to announce its plans this month to let go of 1,100 employees, nearly 14 per cent of its workforce, spanning across grades and functions in the cities and head office as Covid-19 continues to hurt its business across verticals.
 
"The biggest impact here is on the Cloud kitchens business, with many unknowns about volumes through the year. Since the onset of Covid-19, we have already begun the process of shutting down our kitchen facilities temporarily or permanently, depending on their outlook and profitability profile," Sriharsha Majety, Co-founder and CEO, Swiggy, said in a statement announcing the lay offs.
 
Similar is the story of Zomato, another unicorn, which is Swiggy's major rival in the India market.
 
Zomato, which is also a favourite among investors, also got hit hard by the COVID-19 pandemic, leading it to announce the decision to lay off nearly 13 per cent of its workforce -- over 600 employees.
 
"While we continue to build a more focused Zomato, we do not foresee having enough work for all our employees. We owe all our colleagues a challenging work environment, but we won't be able to offer that to 13 per cent of our workforce going forward," Zomato CEO Deepinder Goyal said in a statement this month.
 
Similarly, barely days after raising over Rs 319 crore in Series D round of funding, financial technology company Lendingkart Technologies announced it has laid off nearly 200 employees, or 30 per cent of its workforce.
 
LendingKart was identified as a "Soonicorn" by Inc42 in the digital lending space for possessing the potential to become a Unicorn company by 2020.
 
In a statement, the company said the outbreak of COVID-19 and the resultant slowdown has compelled it to take some measures to rationalise the employee base across offices to ensure long term sustainable business.
 
"This exercise is an extension of our annual appraisal cycle, wherein we do rationalise the team by about 15-20 per cent basis performance. This year, additional right sizing has been undertaken to account for the business volumes that we anticipate in this financial year," the company said in a statement on Friday.
 
According to a survey by IT industry body Nasscom this month, 90 per cent tech startups in India are facing a decline in revenues due to the impact of COVID-19 pandemic.
 
About 30-40 per cent have already temporarily halted their operations or are in the process of closing down,.
 
Among business-to-customer startups, about 60 per cent are facing business closure, according to the report.
 
About 34 per cent of start-ups are suffering revenue decline of over 80 per cent, showed the findings of the "Start-up Pulse Survey".
 
While 70 per cent of travel and transport startups reported suffering 40 per cent revenue decline, 14 per cent of edtech, fintech and healthtech startups expect growth in revenue amid the COVID-19 crisis.
 
The month-long survey further revealed that 70 per cent start-ups have runway less than three months, with those in the business-to-customer segment majorly affected.
 
With over 9,300 tech start-ups, India continues to be the third largest tech startup ecosystem in the world.
 
Disclaimer: Information, facts or opinions expressed in this news article are presented as sourced from IANS and do not reflect views of Moneylife and hence Moneylife is not responsible or liable for the same. As a source and news provider, IANS is responsible for accuracy, completeness, suitability and validity of any information in this article.
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    COMMENTS

    2nsmds

    1 month ago

    india needs funding for tech shut down ventures -shut down infosys, wipro tcs\
    hcl tech or reduce them to 13rd or less.

    i got a plan. but i am goign solo wihtout use of a p or a

    tillan2k

    1 month ago

    employees are aware thy live by slender thread with such companies still they buy expensive, mobiles, mobikes, and trendy clothes... low loyalty is on both sides

    India Resumes Domestic Passenger Flight Services
    After many anxious moments India resumed civil passenger flight services on Monday, exactly two-months after it had suspended these operations due to the outbreak of Covid-19.
     
    Accordingly, IndiGo operated its Delhi-Pune service early on Monday.
     
    The IGI Airport will receive a SpiceJet flight from Ahmedabad later.
     
    Similarly, two flights operated at the CSMIA, while one departed from Mumbai for Patna, the first arrival was from Lucknow as the domestic flights operations resumed. Both operated by IndiGo, the first service to Patna flew out at around 6.45 a.m., while the incoming flight landed aound 8.20 a.m., said airport officials.
     
    Several other incoming and outgoing flights are scheduled during the day as the Maharashtra government late on Sunday permitted restricted operations in view of the Covid-19 pandemic that has gripped the state in a big way. The Chhatrapati Shivaji Maharaj International Airport authorities and the BrihanMumbai Municipal Corporation, state government and other agencies have deployed full Covid-19 protocols to handle the incoming and outgoing flight passengers.
     
    Flights are so expected to resume at Pune, Nagpur -- both international airports -- besides smaller state airports like Nashik, Shirdi, Kolhapur etc.
     
    The re-commencement of services comes a day after massive spike in ticket cancellations, along with a drop in bookings, was reported by the aviation industry for Monday's flights as several states had moved to limit air operations.
     
    Consequently, in order to calm nervous passengers Centre said that barring just two states rest of the country is open to accept domestic flights.
     
    On Sunday evening, Union Civil Aviation Minister, on Sunday evening tweeted that states across the country will resume domestic flight services on Monday except Andhra Pradesh and West Bengal.
     
    Airports in Andhra Pradesh will resume services on Tuesday and West Bengal will restart on Thursday.
     
    "It has been a long day of hard negotiations with various state govts to recommence civil aviation operations in the country. Except Andhra Pradesh which will start on 26/5 & West Bengal on 28/5, domestic flights will recommence across the country from tomorrow," Puri tweeted.
     
    Sources said that starting May 28, Kolkata and Bagdogra airports will each handle 10 arrivals and 10 departures per day.
     
    Further, according to people in the know, both Vijayawada and Vizag airports in Andhra Pradesh will operate 20 per cent of both arrivals and departures as planned under the Summer Schedule. Hyderabad will resume services on Monday with 15 arrivals and 15 departures, sources said.
     
    In another tweet, the minister said that starting Monday, there will be limited flights from Mumbai and as per approved one-third schedule from other airports in the state.
     
    For Tamil Nadu, he said that there will be maximum 25 daily arrivals in Chennai, but there would be no limit on number of departures.
     
    "As per request of state govt, operations in Andhra Pradesh will recommence on limited scale from 26 May. For Tamil Nadu there will be max 25 arrivals in Chennai but there's no limit on number of departures. For other airports in TN flights will operate as in other parts of country," Puri said.
     
    Resultantly, passengers, who had booked for flights on these and other intra-metro route segment for May 25, rushed to cancel their tickets.
     
    Industry insiders had pointed out that majority of bookings received were for flights between metro cities, due to the "pent-up demand", but now with limited operations and quarantine norms, a large number of queries have been received from passengers travelling to these cities.
     
    Even airline executives were left in lurch on Sunday evening as state after state came out with new norms for accepting flights, thereby, distorting their network planning.
     
    Another daunting confusion was over the quarantine norm which many states said they will enforce on air travellers.
     
    This led to a cascade of calls at the customer care centres of online travel agents.
     
    Nevertheless, many passengers still wanted to travel, if they were provided with a choice for 'Home Quarantine'.
     
    Earlier, air passengers gave an overwhelming response to the re-commencement of passenger flight services from May 25, as healthy demand was witnessed for tickets on all metro routes. 
     
    The Centre had only allowed limited passenger flight operations of about one-third capacity of the summer schedule to operate between metro cities and other destinations from May 25, adding that this capacity might be ramped up in the coming period.
     
    Passenger air services were suspended for both scheduled domestic and international flights since March 25, due to the imposition of the nationwide lockdown in the wake of the Covid-19 outbreak.
     
    Disclaimer: Information, facts or opinions expressed in this news article are presented as sourced from IANS and do not reflect views of Moneylife and hence Moneylife is not responsible or liable for the same. As a source and news provider, IANS is responsible for accuracy, completeness, suitability and validity of any information in this article.
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    Seize LG Polymers premises, orders Andhra HC over gas leak
    The Andhra Pradesh High Court has ordered that the premises of LG Polymers in Visakhapatnam be seized in the case relating to gas leakage from the plant which claimed 12 lives and affected hundreds of others on May 7.
     
    The court, in interim orders, directed that the company shall be completely seized and no one including the Directors of the company be allowed to enter the premises.
     
    A division bench of Chief Justice Jintendra Kumar Maheshwari and Justice Lalitha Kanneganti also directed that none of the assets, movable or immovable, fixture, machinery and contents shall be allowed to be shifted without the court's permission.
     
    The court also ruled that if any committee wants to inspect the premises, it will be at liberty to do so but will have to put a note on the register maintained at the gate of the company regarding the said inspection and while returning, a note regarding the act done in the premises.
     
    The court, while hearing three writ petitions, passed the interim orders on Friday but the written orders were issued on Sunday.
     
    The bench also took serious note of the transportation of styrene monomer from the plant to South Korea. "After registration of crime, on appointment of the investigation/inspection team and also when Magisterial enquiry was required, why, without appointment of the said panel or permission of the Court, Styrene Monomer has been permitted to be transported to South Korea and who is the person responsible for the same," the court asked and directed the Central and state governments, various government agencies and the company to submit the compliance report by May 26.
     
    The court, which posted the next hearing to May 28, also wanted a reply on the net worth of LG Polymers Pvt Ltd.
     
    The high court on May 7 had suo-moto taken up the case and passed orders. Both the state and the Central governments submitted action taken reports by May 20. The court observed that the replies by the state and Central governments were silent on certain issues, which were also raised in two writ petitions filed subsequently.
     
    The court sought explanation from respondents on various issues including the issue that LG Polymers has been operating without a valid environmental clearance from the Union Environment, Forests and Climate Change Ministry. It also wanted explanation on the point that the inhibitor concentration in the storage tank was not checked, the refrigeration system was not working properly, the radius of the vulnerable zone extended up to 6.3 km from the sources and the siren/alarm system did not function.
     
    Disclaimer: Information, facts or opinions expressed in this news article are presented as sourced from IANS and do not reflect views of Moneylife and hence Moneylife is not responsible or liable for the same. As a source and news provider, IANS is responsible for accuracy, completeness, suitability and validity of any information in this article.
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