Edtech firm Vedantu went for a second round of lay-offs on Wednesday. CEO Vamsi Krishna said in an email to his staff that the company is laying off about 7 per cent or 424 employees out of the 5,900. This is the company’s second round of lay-offs in May. Earlier this month, the edtech firm had laid off 200 employees.
A spokesperson had said earlier this month that about 120 contractors and 80 full-time employees were being reevaluated. “We have an annual contract with them, and at the beginning of every academic year, we follow a process of load rebalancing where we rejig pertaining to these roles, based on our growth expectations. Reassessment cannot be done in the middle of the year as the learning experience and continuity of the teachers throughout the year is our first priority,” the spokesperson had said.
But following the second round of lay-offs CEO Krishna said in his mail that the capital will be scarce for the upcoming quarters considering the Russia-Ukraine war, impending recession fears and Fed rate hikes that have led to inflationary pressures and massive correction in domestic and global stocks. “With COVID tailwinds receding, schools and offline models opening up, the hyper-growth of 9X, Vedantu experienced during the last 2 years will also get moderated,” he said.
“There is no easy way to say this but I am truly sorry. Pulkit, Anand and I are indebted to you for having believed in the vision and giving your precious time and energy to Vedantu. Also remember, this is not your fault and it's not happening because of anything you did or didn't do. You are awesome and the companies out there will be super lucky to have you,” he said in his email.
Vedantu’s lay-off of over 600 employees comes after its rival, Unacademy, laid off 600 employees in April. Ronnie Screwvala-backed start-up Lido Learning also shut its operations. Many employees alleged that Lido had not paid salary for several months. Additionally, Meesho, Furlenco, and Trell have laid off employees too as investors start exercising caution amid global macroeconomic conditions.
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