Google-backed Adda247 has reportedly fired around 250-300 employees across multiple verticals as it looks to extend its runway amid the ongoing funding winter.
Sources told Entrackr that Adda247 was laying off 100-150 employees at its UPSC-focussed test prep vertical StudyIQ, which it acquired in December 2021. Another 150 employees from sales, content and faculty teams have also been shown the door by the edtech startup.
A mail sent to Adda247 seeking comments on the development didn’t receive any response till the time of publishing this story.
As per the report, the layoffs were undertaken as the edtech player doesn’t expect the investment environment for the sector to improve.
The employees were reportedly told to resign without any prior notice and there was no townhall or communication from the human resources department before handing out the pink slips.
The development comes exactly a year after the edtech startup bagged $35 Mn investment in a funding round led by WestBridge Capital, with Google also joining the cap table. Curiously, the edtech startup left no stone turned to pump in heavy capital and other resources to expand the UPSC test prep vertical.
As of July 2023, StudyIQ’s YouTube channel had accumulated more than 14 Mn subscribers and clocked more than 90 Mn views a month. Not just this, the test prep platform also more than doubled its revenue to INR 66 Cr in FY23 compared to INR 30 Cr in FY22.
However, losses continue to pile up for Adda247. Adda247’s loss widened more than 10X to INR 157.8 Cr in FY22 from INR 15.18 Cr in the previous fiscal year. On the other hand, revenue grew 1.6X YoY to INR 61.5 Cr (further grew to INR 138 Cr in FY23) in the year ended March 2022 compared to INR 36.5 Cr reported in FY21.
However, this did not stop Adda247’s acquisition spree as it went on to acquire 3D experiential learning platform Veeksha for an undisclosed amount in June this year.
With the layoffs, Adda247 has joined a growing list of Indian edtech startups that have fired employees. All major startups in the space – from BYJU’S to Unacademy – have undertaken mass layoffs in a bid to cut corners and streamline operations. Many such as Crejo.Fun and Udayy have also shut shop owing to funding constraints.
The edtech space has been the worst hit by the funding winter in the Indian startup ecosystem and accounts for more than 7,800 employee layoffs since last year. Saddled with losses and no clear path to profitability, Indian edtech startups have also seen investors shy away from pumping capital in the space.
Despite this, the edtech space is expected to scale up further on the back of a hybrid model. As per an Inc42 report, the homegrown edtech space offers an attractive market opportunity of $29 Bn by 2030.
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