This is the third round of layoffs at the Bengaluru edtech unicorn, which sacked
around 624 full-time and contractual employees in two batches in May.
The company became a unicorn last September after it raised $100 million led by Temasek-backed impact investing fund ABC World Asia.
Interestingly, cofounder and chief executive Vamsi Krishna had said in a memo to employees on May 18 that the previous retrenchment exercise was a ‘one-time activity’, with no more layoffs expected. The memo was also published on the company’s blog.
He had blamed global macro-headwinds and impending recession fears as major reasons for the layoffs.
“Currently, the external environment is tough. War in Europe, impending recession fears, and Fed interest rate hikes have led to inflationary pressures with massive correction in stocks globally and in India as well. Given this environment, capital will be scarce for upcoming quarters. With Covid-19 tailwinds receding, schools and offline models opening up, the hyper-growth of nine-times Vedantu experienced during the last two years will also get moderated. For long-term sustenance of the mission, V (Vedantu) would need to adapt too,” he had said.
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Krishna added that through the layoffs the company was trying to create a runway for 30 months, focus on reducing customer acquisition costs, and align all teams and projects to its core focus area.
Inc42 first reported about Vedantu’s latest round of layoffs on Tuesday evening.
ET first reported on April 7 that rival edtech unicorn Unacademy had laid off around 1,000 employees including on-roll and contractual staff across its core offerings and group companies such as PrepLadder.
As investors push founders to brace themselves for a funding winter, Indian startups have cumulatively shed more than 10,000 employees this year.
With offline learning opening up, Indian edtech firms have also found themselves in a tricky spot as demand for online education weakens.
Several Indian edtech majors such as Byju’s and Unacademy have taken the fight offline as they continue to jostle for market share with traditional tutoring firms.
In June, Vedantu launched its first hybrid learning centre in Muzaffarpur, following the strategy of its edtech peers. Its offline learning foray is largely focused on the test preparation segment as it looks to diversify from its core kindergarten-to-grade-12 offerings.
