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    Cars24 fires 600 employees across departments

    Synopsis

    ​Cars24, backed by Japan’s SoftBank and Alpha Wave Global, has joined a growing list of startups such as Unacademy, Vedantu, and Meesho that have let go of staff to conserve cash amid a slowdown in funding.

    cars24ETtech
    Cars24 founders (from left) Vikram Chopra, Mehul Agrawal, Ruchit Agarwal and Gajendra Jangid.
    Bengaluru: Used car marketplace Cars24 has fired more than 600 employees, people aware of the matter said, with the layoffs put in place across departments and roles.

    This is over 6% of its total headcount of about 9,000 people.

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    “This is business as usual performance-linked exits that happen every year,” the company said in a statement.

    Cars24, backed by Japan’s SoftBank and Alpha Wave Global, has joined a growing list of startups such as Unacademy, Vedantu, and Meesho that have let go of staff to conserve cash amid a slowdown in funding.

    ET reported on April 28 that startups had begun to cut costs and run a tight ship after a record year of fundraise and aggressive expansion.

    Over the past few weeks, over 2,400 contractual and full-time employees have been fired from ed-tech firm Unacademy, Vedantu, social commerce startups Meesho and Trell, online learning platform Lido Learning and furniture rental startup Furlenco.

    Some of these companies may look to cut more jobs, people in the know said.

    The layoffs at Cars24 have come at a time when it is looking to expand globally.

    ET reported in November that the company was looking to expand to the Middle East and Southeast Asia. The company, which has been present in the UAE and Australia, has also entered the Thailand market.

    In India, it competes with Droom, CarTrade, Spinny and CarDekho.

    Cars24 last closed a $400 million financing round led by Alpha Wave Global in December.

    This included a $100 million debt component.

    The company’s valuation jumped three times to $3.3 billion after the funding round.

    It became the first unicorn in the used car market space by raising around $200 million in November 2020.

    Cars24 was founded in 2015 by Vikram Chopra, Mehul Agrawal, Ruchit Agarwal and Gajendra Jangid. The company in February announced a Rs 75 crore employee stock ownership plan for current and former employees.

    Startups layoffs mountETtech

    • In February, Lido Learning laid off over 150 employees, just five months after closing a $10 million funding round from Ronnie Screwvala's Unilazer Ventures.
    • In March, social commerce startup Trell said it would lay off hundreds of employees amid a probe into financial irregularities at the firm.
    • The same month, furniture rental startup Furlenco laid off 180-200 employees.
    • Meesho followed in April, laying off 150 employees from its grocery business, Meesho Superstore.
    • In March, Unacademy fired 1,000 employees, including on-roll and contractual staff amid slowdown in online education.
    • Vedantu has announced 624 layoffs in May, including 424, about 7% of its workforce on May 18.
    ET had reported on April 28 that startups had begun to cut cost and run a tighter ship after a record year of fundraising and aggressive expansion
    The Economic Times

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