In response to the growing financial problems, social networking site ShareChat has fired 200 workers, or around 15% of its workforce, in a second such decision. ShareChat, an Indian social networking startup, has been having trouble since this fiscal year when its valuation was slashed by more than half.
ShareChat reportedly let go of 200 workers on Wednesday after releasing an official statement regarding the firm's "strategic restructuring" and "streamlining cost base" following a significant decline in its total valuation, Economic Times reported.
On December 20, the business released a statement saying, "ShareChat today undertook a strategic restructuring as a part of its annual planning for 2024. The statement further said that the choice is in line with the business's objective to achieve profitability in the next four to six quarters by simplifying its cost base.
This latest round of layoffs at the company follows ShareChat's decision to reduce expenses earlier this year by terminating 600 workers. On the other hand, the corporation has not yet disclosed any details regarding the employees' severance payments.
According to a report by The Economic Times, ShareChat, a Bengaluru-based startup, saw its valuation reduced from $4.9 billion to $1.5 billion (about ₹28,300 crore) this year. According to TechCrunch, ShareChat, which is supported by Google and Tamasek, is close to obtaining $50 million in fresh capital to make up for its diminished valuation. The business has raised $1.4 billion in total thus far.
By 2023, ShareChat had let go of about 25% of its whole staff. Before this, 100 workers of ShareChat's parent business Mohalla Tech lost their employment when Jeet11, a fantasy gaming firm, was shut down.
Co-founders of ShareChat, Bhanu Pratap Singh and Farid Ahsan, left the social media platform in January 2023, which caused investors to lose interest in the business as it struggled to attract capital. After layoffs and an increase in the proportion of net loss, ShareChat's valuation rapidly decreased from its $5 billion peak in March.
