In today’s world, where the competition is at an all-time high, the survival of a business depends upon a lot of factors. Even the slightest of the wrong moves can make all the difference, leading to difficult decisions such as layoffs. Unfortunately, the job market has become unpredictable, and employees have started to experience the worst of it. Layoffs have become a common sight in organizations these days, and one such example is the recent layoff of over 150 employees at Lido, the edtech start-up.
Lido is a Mumbai-based edtech start-up founded in 2019. The company aims to provide quality education to children from grade 4 to grade 9. It offers a platform for online learning, which includes interactive live classes with teachers and personalized feedback. Its unique teaching methodology has been appreciated by students, and the company has received a lot of attention from investors.
Funding and Investors
Within two years of its inception, the start-up raised $24 million in a Series A funding round led by GGV Capital, with participation from Mubadala Capital, January Capital, and Rocketship VC. The funding was used to expand the company’s operations and reach more students across the country. With such strong backing from investors, the start-up was poised to grow exponentially and make a name for itself in the education sector.
However, as fate would have it, Lido’s growth story did not go as planned, and the start-up was forced to lay off over 150 employees in February 2022. The news came as a shock to many, as it came just five months after the start-up raised $24 million in funding.
The reason for the layoffs, as stated by the company, was its inability to achieve the desired growth targets. According to reports, there was a significant gap between the actual number of students enrolled and the number of students projected by the company. This, coupled with the high cost of acquiring new customers and the lack of demand due to the pandemic, led to the layoff decision.
Impact of Layoffs
The layoff decision is undoubtedly a difficult one, leaving a lasting impact on the laid-off employees and their families. However, it is equally important to understand the impact it has on the start-up itself. With the loss of experienced and skilled employees, the remaining employees may face an increased workload and additional responsibilities. It may also lead to a dip in employee morale and affect the overall company culture. Moreover, the layoff decision’s publicity can also affect the company’s reputation, making it difficult to attract new employees and customers.
Company’s Stakeholders’ Statement
In response to the layoffs, Lido’s CEO, Sahil Sheth, released a statement on the matter. He acknowledged the difficult decision the company had to make and stated that they were working to provide adequate support to the affected employees. He also assured that the start-up’s decision did not affect its commitment to providing quality education to students and that it would continue to work towards its vision.