Social networking site ShareChat has laid off one-fourth of its workforce in India. The app backed by Twitter sent an email to employees informing them of the various cost-cutting measures, including laying off 101 employees, undertaken by ShareChat as coronavirus hurts business.
The app said that it expects the advertising market to be unpredictable this year. ShareChat that is five years old and has 60 million active monthly users in India monetised the platform through advertising in October 2019. However, as the COVID pandemic slowed down economic activity, the advertising market has been severely impacted.
Ankush Sachdeva, co-founder and CEO of ShareChat said in the mail that they have to focus on their core product and "feed recommendation-driven growth levers" as it scales back on others. "We need to go back to our fundamentals in terms of only picking bets that move the needle for growth," he said in the mail as reported in The Economic Times. He added that the app is streamlining its revenue teams according to the expectations from the ad market.
Sachdeva also said that while the company was fortunate to raise capital last year, it has to relook at the business now. "This is a very tough call for us. I hope you understand that we had to do it for the organisation to sustain and see it through to the other side of this pandemic," he said. "Please accept my apologies as we haven't been able to ensure that everyone of you continued on this journey," said Sachdeva.
ShareChat employees that have been laid off can either opt for a 'garden leave' of two months or avail half the salary for four months. Garden leave is a practice where the employee is asked to stop working during the notice period but is still kept on the payroll. The impacted employees would also get a month's ex gratia for every year that they have worked for the company.
The health insurance policy of these employees would continue till the end of the year and the timeline for the stocks employees own will also be extended till the end of the year. The company would also help the employees find relevant openings in the market and connect them with other organisations and agencies.
ShareChat raised $100 million from Twitter and other investors in August last year. The app is backed by SAIF Capital, Shunwei Capital, Lightspeed Venture Partners and TrustBridge Partners.