ShareChat Layoffs: Bengaluru-Based Social Media Platform Lays Off 5% of Its Workforce Amid Raising Millions in Fund Through Debt Financing; Know Why
ShareChat laid off 5% of its workforce as it raised USD 16 million funds in debt financing from Singapore-based EDB Investment firm. The ShareChat layoffs were a part of performance improvement plan.
Bengaluru, August 6: The Indian social media platform ShareChat recently laid off 5% of its workforce amid a USD 16 million increase in debt financing. The ShareChat layoffs were implemented as part of a PIP (performance improvement plan) aimed at lowering costs and increasing profitability. The job cuts affected around 40 employees out of the company's total workforce of 800 people.
According to reports, ShareChat raised USD 16 million in debt financing from Singapore-based EDB Investments. The EDBI firm is also an investor in LiveSpace, a home design and renovation platform. By raising the funding in debt financing, ShareChat increased the total size of its previous debt round to USD 65 million. Dell Layoffs: Tech Giant Lays Off Employees in Sales Department Amid Restructuring Plans for New AI-Focused Unit.
A ShareChat representative reportedly told the company that the social media platform had launched a mid-year performance cycle. The spokesperson added that some employees would be impacted based on their performance, as was the company's usual practice. ShareChat expressed that it would continue to hire high-quality individuals for a number of positions with different functions.
The Indian-based social media platform raised USD 49 million in April 2024 from existing investors in convertible debentures. The reports said that ShareChat's parent company, Mohalla Tech, had been trying to reduce operating costs and tighten the funding environment. Mohalla Tech also owns the short-video hosting platform Moj.
ShareChat also faces competition from existing social media giants like Instagram and Google's YouTube platforms. The reports said that the additional funds raised by the platform would be used to invest in the company's advertising technology. It is also aimed at developing the latest monetisation features for its creator ecosystem and expanding the consumer transaction business. Infineon Layoffs: German Chipmaker Laying Off 1,400 Employees and Planning To Relocate Same Number to Low-Wage Countries Amid Revenue Drop in Q3.
ShareChat said the business was going well and operationally profitable for months. On the other hand, the video-sharing app Moj was reportedly reaching a breakeven point.
(The above story first appeared on LatestLY on Aug 06, 2024 12:17 PM IST. For more news and updates on politics, world, sports, entertainment and lifestyle, log on to our website latestly.com).