SOURCE : NEW18 NEWS
Last Updated:January 15, 2025, 18:10 IST
After the layoffs, ShareChat’s workforce will shrink to about 500, a significant reduction from its peak of 2,800 employees several years ago.
ShareChat currently employs between 530 and 550 individuals.
ShareChat, a social media platform backed by Google and Temasek, plans to lay off around 5 per cent of its workforce, translating to 20-30 employees across departments, after an annual performance review, according to a Moneycontrol reporting.
While the projected figure stands at 4 per cent, ongoing cost-cutting measures suggest the final number could be higher, according to the report citing ShareChat spokesperson.
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“We have just kickstarted our annual appraisal cycle. Every performance cycle, as a practice, roughly 3-4 per cent of employees are rated at the bottom of the pyramid in terms of performance. And those people are asked to leave,” the spokesperson stated.
Workforce Reduction and Historical Layoffs
ShareChat currently employs between 530 and 550 individuals. After the layoffs, the workforce will shrink to about 500, a significant reduction from its peak of 2,800 employees several years ago. The company has consistently trimmed its workforce over the past two years, laying off over 850 employees through four different cycles.
These actions align with the company’s performance-based policy. “In some cases, we can manage by redistributing the work, while in others, we do replacement hiring. It has been part of our performance philosophy for the last four years now. People who are not pulling their weight, or are not justifying their ROI (return on investment), are asked to leave and we replace them,” the spokesperson said, according to Moneycontrol.
In August 2024, ShareChat let go of 30-40 employees during its bi-annual performance review, following a $16 million convertible debt raise. Earlier, it laid off over 200 employees in December 2023, and more than 600 staff members in January 2023.
Financial Optimisation and Operational Progress
Despite these layoffs, ShareChat has been focused on cost optimisation and improving profitability. The company’s adjusted EBITDA losses fell by 67% in FY24 to ₹793 crore, compared to ₹2,400 crore in FY23. Its total loss before tax also dropped by 63%, from ₹5,143 crore in FY23 to ₹1,898 crore in FY24.
The company’s revenue from its livestreaming business grew 41% year-on-year to ₹402 crore. Additionally, it claimed profitability in October 2024, achieving an EBITDA margin of over 15%. Moj, its short video platform, is reportedly operationally profitable, with expectations of full profitability by FY25.
Recruitment and Leadership Changes
Although job cuts are underway, ShareChat has clarified that these layoffs are not linked to its profitability efforts. “This (job cuts) has nothing to do with our profitability journey. It is linked to keeping a high-performing organisation,” the spokesperson noted.
Interestingly, the company has continued to expand its team in specific areas. Last month, former TikTok executive Nitin Jain was appointed as Chief Technology Officer (CTO). The company also hired a new head of acquisition marketing and is actively looking to grow its acquisition marketing team by 50%, with several positions currently open.
“We have a bunch of new positions open. It can’t be that a company is hiring and firing at the same time…We are not in a position where we needed to cut people cost,” the spokesperson clarified.
Founded in 2015 by Ankush Sachdeva, Bhanu Pratap Singh, and Farid Ahsan, Bengaluru-based ShareChat has raised $1.3 billion through multiple funding rounds. Key investors include Tiger Global, Snap Inc., Elevation Capital, and Twitter (now X). Notably, co-founders Ahsan and Singh exited the company to start a new venture, which secured $3 million in funding in 2023.
While several Indian social media platforms have struggled to scale or sustain post the ban on Chinese apps, ShareChat has shown resilience by adapting its cost structure and diversifying revenue streams. This latest workforce reduction underscores its commitment to maintaining a high-performing team amid a challenging social media landscape.
