UNACADEMY LAYS OFF 600 STAFF TO CUT EXPENSES

India’s edtech sector is starting to show signs of tremors at a time startup valuations are booming fuelled by a covid-induced surge in demand for remote learning. Edtech unicorn Unacademy, run by Sorting Hat Technologies Pvt. Ltd, has laid off nearly 600 employees or about a tenth of its workforce, said two people aware of the development.

Those laid off in the past few weeks are full-time employees from the sales and marketing team, along with a few contractual staff and educators or tutors, the people said on the condition of anonymity.

A spokesperson for Unacademy confirmed the company’s move and said “based on the outcome of several assessments, a small subset of the employee, 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 spokesperson added that the “company has in good faith ensured they receive certain additional benefits and a generous severance.”

In March, Unacademy let go over 100 employees from its Prepladder team amid a company “restructuring”. Unacademy is currently valued at $3.44 billion and counts global venture capital firms such as Sequoia Capital , Softbank and Tiger Global Management among its backers.

Unacademy is not alone. In late February, Lido Learning asked more than 1,200 of its employees to resign. Lido said at the time that it was looking to wind down its operations amid a funding crunch.

The workforce restructuring by Unacademy comes at a time its co-founder and chief executive Gaurav Munjal has announced plans for a public listing in two years. Munjal said in March that the company’s core business was on track to turn profitable.

According to the spokesperson, Unacademy is focused on becoming profitable by the December quarter of 2022 in its core business.