SaaS startup Chargebee on Thursday laid off around 10% of its total workforce, citing uncertainty in macroeconomic factors within the tech industry and as fundraising became more challenging in the last few quarters.
Chief executive and co-founder Krish Subramanian shared a copy of his email to employees announcing the layoffs in a LinkedIn post. He mentioned that the layoffs were initiated to “make corrections to our scale and structure to build a more efficient, stronger organisation”.
“You are all aware of current global macroeconomic challenges – and everyone is bracing given the uncertainty that we are going through. While we are positioned well for the future in the long term given our market opportunity and financial position, we are in an unfortunate situation where we have to make corrections,” Subramanian said in the email.
San Francisco-headquartered Chargebee has offices in four locations, including Chennai, Sydney, and Amsterdam. The job cuts impacted around 142 employees across all these locations, a spokeswoman for Chargebee confirmed in an email response. She added that Chargebee is already working with more than 50 companies to help affected employees find new positions.
In the email to employees, Chargebee CEO Subramanian pointed out that affected employees will get a three-month severance package along with extended health insurance, and an extension of time to exercise stock options granted under the startup’s stock incentive plan.
“We have a responsibility to build a financially sound business for the greater interest of everyone involved. While historically we have been philosophically opposed to layoffs, after careful consideration, it is best to act now to offer separation packages to affected colleagues,” Subramanian added.
He further highlighted that at the start of Q2, macroeconomic factors began impacting public companies and the financing environment, and due to this uncertainty, companies globally are forced to move towards a profitable pace.
“As you know, we changed our hiring plan to align with priorities and started implementing stricter fiscal discipline to reorient the company towards long-term sustainability…Facing a growing gap between our revenue and spends, we have been reducing our expenses across various areas including tools, consulting, and contractors, etc,” he said.
Founded in 2012 by KP Saravanan, Subramanian, Rajaraman Santhanam and Thiyagarajan Thiyagu, Chargebee is a business-to-business SaaS start-up that offers a subscription and recurring billing system for SaaS and e-commerce businesses. More than 17,000 businesses globally use the services of Chargebee, it said in an earlier statement.
The startup joined the unicorn club in April last year when it secured a $125-million funding round. To date, it has raised more than $460 million in equity funding from prominent investors such as Sapphire Ventures, Tiger Global, Insight Venture Partners, and Steadview Capital.