Also in this letter:
■ After two-year funding boom, agritech startups begin layoffs
■ Efficiency-focused deals to help offset delays in Europe: HCLTech CEO
■ Cognizant looks to get its mojo back under new CEO Ravi Kumar S
Dunzo, ShareChat, Rebel Foods to conduct layoffs amid funding winter
Large consumer internet firms are moving fast to rein in costs and are planning additional layoffs as 2023 begins on a cautious note, multiple sources and investors briefed on the matter told us.
Dunzo: Reliance Retail-backed Dunzo is understood to have conducted layoffs last week even as it simultaneously is cutting costs to optimise operations, sources told ET. Sources said the company is estimated to have cut at least 60-80 jobs at the firm across divisions.
ShareChat: Its parent MohallaTech is also finalising another round of layoffs in the coming weeks, which is likely to be larger than its previous round in December, in which it laid off around 100 people. Sources told us more than 200 people could be laid off this time. The company has also been reworking its cloud deals and doing away with daily meal coupons for employees to cut costs.
Rebel Foods: The cloud kitchen, which houses brands like Behrouz Biryani, Oven Story, has also cut its workforce. A spokesperson said any changes in employee strength is on account of “annual performance evaluation and realigning the organisation” to the firm’s priorities for future goals.
Others: Just two weeks into the New Year, startups like Cashfree, Moglix and others have fired employees. Amazon India has also notified its staff about the retrenchment of around 1,000 employees here.
When will it end? The latest developments are an extension of what has transpired in the so-called new economy over the last six to eight months. Layoffs at tech startups are expected to continue until the end of quarter, after which the situation could improve, industry experts said.
Also Read | 2022 Year in Review: Fund-starved startups sacked nearly 18,000 employees
After two-year funding boom, agritech startups begin layoffs
Agritech startups have joined the growing list of companies that are downsizing their teams amid business model challenges and an overall squeeze in financing for privately held technology companies, industry executives and investors told us.
Details: While Temasek-backed agriculture marketplace DeHaat fired about 5% of its employees last year, other venture capital-backed firms have also conducted layoffs recently, sources said.
- Gramophone let go of around 75 employees across November and December to focus on achieving profitability over the next few quarters, cofounder and CEO Tauseef Khan told us.
- Captain Fresh has been trying to move its business from domestic to international markets since last April. This exercise has led to 120 staffers losing their jobs, founder and CEO Utham Gowda told us.
- BharatAgri, which offers farmers AI-based services on a paid subscription basis, sacked 40 employees in August. The company, which now has 52 staffers, attributed the layoffs to a change in the way it sells products and services.
Boom years: The previously unreported layoffs come after two years of robust funding for the sector. About 63% of the total venture capital invested in agritech in India so far was deployed in the last two years, according to an Avendus Capital report in December.
While 2021 saw $1.22 billion invested in 45 agritech startups, about $796 million came into 30 agritech startups in 2022.
Also read | As funding winter bites, startups think beyond pay, perks to win talent wars
Efficiency-focused deals to help offset delays in Europe: HCLTech CEO
HCLTech’s decisions on new programmes in Europe could be a little slow, given the prevailing uncertainty, while in the US, the core digital transformation programmes will continue, managing director C Vijayakumar said in an interview with ET.
Here are some edited excerpts:
HCL had cautioned investors about macroeconomic challenges in December. Has your perception of the on-ground situation changed?
Customers want to continue their tech to expand, whether it is cloud adoption, operating model changes, or even a little bit more efficiency-led opportunities. So as we move forward, I see possibly two broad themes.
I think the growing tech spend is really coming from the broad commentary that technology is becoming more and more core to the business. So, clients look at this spend as a very important dimension to transform their businesses.
Now, between the US and Europe, I think the overall tech spend will go up.
Will HCL offer a buyback opportunity in the near future?
I think there are several considerations which we have discussed, and we follow the path of dividends. I don’t see a change. I think more importantly, our capital allocation policy has significantly changed over the last couple of years.
We are committed to return more than 75% of our net income. Of course, that’s over a five-year period, but mostly every year, you have been seeing more than 75% returned.
Cognizant looks to get its mojo back under new CEO Ravi Kumar S
Cognizant’s new chief executive officer Ravi Kumar S will look to build confidence and ease out disparate strains in the company’s leadership team, according to analysts, who view his appointment as the $34-billion software exporter’s move to steer it out of a phase marked by market-related challenges and relative underperformance.
US-based analyst Moshe Katri, who had predicted board action, told ET that former Infosys president Ravi Kumar’s appointment as CEO at Cognizant is an “important event” aimed at resolving challenges like “record attrition rates, delivery constraints as well as lagging peer-like growth”.
Catch up quick: The company announced on January 12, that Ravi Kumar was to replace Brian Humphries as the CEO. Humphries’ four-year tenure as the CEO saw him deal with controversies such as an attrition rate as high as 36% and senior executives’ move to tier-II peers (Debashis Chaterjee to Mindtree, for example).
Quote: “Cognizant needs a leader who can stabilise the confidence with clients, attract and retain top talent, and bring the intellectual capabilities needed to chart a post-digital course,” Ryan Wang, CEO of Constellation Research told ET.
Swiggy rolls out ambulance service for delivery partners
Food tech major Swiggy has rolled out ambulance services for delivery partners and their dependents.
How it works: Delivery partners can reach the ambulance service instantly by tapping the SOS button on the partner app or through a toll-free number. The current average response time is 12 minutes.
The service is free for delivery partners and their dependents—spouses and two children, who are covered under the insurance provided by Swiggy. Delivery partners can also choose to avail of the ambulance for family members not covered under their insurance at a subsidised cost.
Why it matters: The decision comes after a delivery partner of the company, died on January 2 after his scooter collided with a car in Noida. Last month, a 27-year-old delivery executive at rival Zomato was also killed after his motorcycle was hit, allegedly by a speeding car in the same Delhi suburb.
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