As per recruitment company Careernet, the layoff of employees is continuing amid the scarce funding. The company revealed that as many as 9,400 employees have been let go in the first quarter of 2023.
The worst hit among the sectors was the education technology sector, with firms such as Byju’s, Unacademy and MyGate letting go of more than 1,000 workers at a time.
As per the study, 70% of all start-ups made redundancies of between 100 and 300 people.
While the layoffs are alarming and they shall continue to happen, the number of hiring numbers in the senior roles is also bleak as it has dropped by about 80 per cent in the first quarter compared with the same period last year.
Startups Funding Crunch as Investors More Prudent to Tech Investments
Hit by a shortage of funding as investors adopt a more cautious approach to tech investments, even the companies with sufficient capital are slowing down on hiring as growth plans have been redesigned in line with the current macroeconomic conditions.
Sectors such as banking, financial services and insurance are increasing their hiring. The situation as per the report is not likely to improve over the next two quarters.
Traditional companies such as these are setting up larger teams in India and start-up employees are showing no hesitation in moving to these sectors.
Seed-Stage Deals Grow
Siddarth Pai, founding partner at early-stage venture capital firm 3one4 Capital said that despite the slowdown in funding, the industry is seeing ticket sizes in seed-stage deals increasing from a minimum of $1 million.
With about $3.4 billion being raised, there were a total of 260 funding deals during the period under review.
Notably, the number in the same period last year has $12 billion, which means that this year the funding has seen a decline of 71.6 per cent by value.
Speaking of the funding deals, then the number of growth-stage funding deals was led by the e-commerce sector, whereas late-stage fintech start-ups received the most funding. Enterprise technology companies took the top spot in both bridge and seed-stage funding rounds.
