Several Indian startups, like Acko, Droom, Exotel, and MakeMyTrip have started to cut jobs as the coronavirus pandemic has dented their financial prospects. In some cases, these companies have asked their employees to take pay cuts to keep their businesses running.
Online insurance firm Acko has laid off around 50 employees, according to a report by the Economic Times. A majority of laid-off staff was employed in Acko's customer service, operation sales, and marketing segments. Acko founder Varun Dua said that businesses impacted by the pandemic are not going to recover soon. He added that the leadership team has taken voluntary salary cuts between 50 per cent and 70 per cent cut.
Online travel firms like MakeMyTrip, Cleartrip and hospitality firms Fab Hotels have also laid off numerous employees amid the lockdown. Last month, MakeMyTrip founder Deep Kalra had said that pay cut would happen across top and managerial levels of the company. MakeMyTrip (MMT) Limited and subsidiaries - Goibibo and redBus also slashed salary of their employees. Travel player ixigo has also announced salary cut across all levels. On the other hand, US-based travel form Fareportal has dismissed 500 people in India.
Another startup Exotel has put a salary cap at Rs 40,000 for the next two months. To show appreciation to employees the company is offering compensation in the form of ESOPs, Extol CEO Shivakumar Ganesan added.
In March, startups like Bounce and Drivezy fired staff members to stay afloat. Bike rental startup Bounce is planning for 20 to 60 per cent pay cut to run its business amid the crisis. Bounce witnessed a 10 to 15 per cent drop in ridership. The company had laid off employees in December 2019 due to the economic slowdown.
Droom, a used car online marketplace, has said that it will be cutting 15 per cent salary in April. However, it denied layoffs.
A majority of the startups have said that they were gauging the situation and will take measures after the lockdown.