Unacademy Layoffs: What's Hitting Indian Ed-tech Industry After Funding Boom?

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Unacademy Layoffs: What's Hitting Indian Ed-tech Industry After Funding Boom?

The Indian ed-tech business has been disrupted by fast-moving ed-tech startups in their pursuit of hypergrowth.

In a recent move, Unacademy laid off almost 1000 employees across different ventures, summing up to almost 10% of its workforce! “It was a periodic retrenchment exercise to improve quality and efficiency”, says the ed-tech brand.

Founded by Gaurav Munjal, Roman Saini, and Hemesh Singh in 2015 as a YouTube channel, Unacademy is now valued at $3.4 billion. At its most recent funding round in August of 2021, the firm received $440 million.

While the K-12 and exam preparation divisions are predicted to lead India's ed-tech industry to $10.4 billion by 2025, it is shocking to know the reasons for the massive layoff by Unacademy.

Reason for mass termination

Unacademy, in their recent statement, mentioned that the concerning move by the company was based on a thorough assessment and a panel of discussions and that the move was common for a company of such size and scale. They also said that the step was taken to improve the efficiency of the company, reduce cash burn, and re-evaluate redundant roles among employees.

“Based on the outcome of several assessments, a small subset of employees, contractor, and educator roles were re-evaluated due to role redundancy and performance, as is common for any organization of our size and scale. The company has in good faith ensured they receive certain additional benefits and a generous severance”, an Unacademy spokesperson released the following statement.

According to the company, employees that have been terminated will receive two months of severance pay, and it aims to complete the process and clear all payments by 20th April 2022.

Rising disagreement amongst employees

Employees shared their dismay with the public and took to social media to express their grief and the fear of an unsure future. Summing up overall reviews from employees, most of them expressed that the move taken by Unacademy was sudden and unannounced, and that they were not given any previous notes or warning about any deteriorating performance. “It was a sudden move, we weren’t informed of any retrenchment exercise or our deteriorating efficiency”, says an employee.

Employees also shared that there was a lack of communication and almost no account of feedback sharing. They were simply redirected to a link where they came to be aware of the layoff exercise.

Some employees were still in their probation period but somehow found themselves to be a part of the layoff. Employees also expressed the pressurizing work at the company, how work could extend to up to 14 hours a day on some days.

A silver lining!

Sympathizing with the now-terminated employees, various tech brands and companies in similar sectors took to social media to provide vacancies for the employees.

With rising questions about private firms and startups, Unacademy’s recent move has contributed to the fear of sudden termination in startups and private firms, further giving rise to the question of job security in such firms and companies.

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