In a continuation of the winter wave of startups layoffs, Bengaluru-based hyperlocal services provider LocalOye has laid off 60 employees. This represents almost 50% of its employee strength. The relieved employees are mostly from its call servicing units, as the online home services company automates more processes. The company however plans to recruit more software and tech resources as it plans to expand operations and focus on revenue.
“This (restructuring) is a result of the startup’s growing focus on automating the entire process of hiring service professionals. The full and final settlements to the relieved employees have already been completed”, LocalOye’s CEO and founder Aditya Rao told told the media. “Over the past few months, we have been hard at work in prioritising efforts on better monetisation and technology adoption from service partners, and this restructuring is another step in that direction”, he said.
Started in 2013 by Rao, a BITS Pilani alumnus, as a service to book venues for events, LocalOye pivoted into a full-stack hyperlocal service discovery and booking provider around health and beauty, tutorials, and home maintenance services. LocalOye had secured $15mn in funding from Tiger Global Management and Lightspeed Venture Partners in April. It counts Sidharth Rao (co-founder of Webchutney), Haresh Chawla (ex-Group CEO of Network 18), and Sachin Bhatia (co-founder of MakeMyTrip) amongst its other investors. Its main competition in the hyperlocal services space are Helpchat, Haptik, UrbanClap and Bro4u.
A couple of months ago, Helpchat had laid off 150 employees while the recent consecutive, mass layoffs at food startups like TinyOwl, Zomato, and ad tech startup Vizury had shocked the startup fraternity. However Aditya Rao himself had come out in support for TinyOwl after its hostage crisis situation last week, with this message, “When the shit hits the fan, everyone loves a scapegoat, dont they? Go go, TinyOwl! keep fighting and keep building!”
Whether the recent spate of layoffs in the Indian startup world are a sign of a maturing ecosystem, or an ominous warning for highly-funded, but low margin services like these, remains to be seen.