Joining a growing list of startups, Hubilo, an online and offline event management platform, has now laid off 35% of its workforce, or 115 employees, across all divisions, as it restructures its business to focus more on the mid-market segment, rather than small businesses (SMBs) and individual organisers, people aware of the developments told FE.
The cost-cutting exercise comes after the Lightspeed-backed company had already sacked 12%, or about 30 staffers, in July last year after demand for physical events started picking up pace. The company believes focusing on the mid-market segment will result in a higher ticket size, as opposed to the lesser purchasing power of SMBs and individuals.
Confirming the development to FE, a member of the top management said, “The company has narrowed its focus and will be selling to a more concentrated set of clients, instead of serving everyone who approached it and the 115 people, who don’t fit in the new structure, were asked to leave on Wednesday.”
Impacted employees will not serve their notice period, instead will be given 1.5X of their severance pay, provided outplacement opportunities, among other benefits, the person cited above added.
The company over-hired and over-estimated growth potential during the Covid years of 2020 and 2021 but through 2022 the demand continued to dip, forcing Hubilo to become a leaner startup.
Also read: Budget 2023: RBI has failed to provide easy credit access to traders, says CAIT
Hubilo did not respond to FE’s queries seeking details about the layoffs.
FE has also learnt that the San Francisco and Bengaluru-based company is also understood to have increased its runway to 72 months, from 54 months earlier, after sacking the 115 employees. The startup will wait and see how the new strategy plays out over the coming months and will even hire people based on the outcome, especially in sales and marketing. Hubilo was not looking to shut shop yet, instead was looking to acquire smaller players who would help the company reach its goals faster, one of the sources cited above said.
Hubilo has so far raised over $150 million from other investors like Alkeon Capital Management.
Also read: India Q3 financial results: Which industry sectors will lead revenue growth? Auto, IT, construction in focus
With this, in January alone, Indian startups have laid off close to 2,500 employees, including large players like Swiggy which is cutting close to 600 jobs, matching that of Mohalla Tech, the parent of ShareChat and Moj. While Google-backed Dunzo, SoftBank-funded Unacademy’s Relevel, Lead, among several others, have fired employees too, albeit at a slower pace, as capital becomes difficult to access and new-age companies try to sustain by generating profits to continue functioning, rather than relying on venture capital and growth at all cost.