Neobanking platform Open has reportedly laid off around 50 employees, joining a number of fintech companies that have resorted to layoffs due to the slowdown in funding, Entrackr reported. The move is aimed at cutting costs and extending the runway in current market conditions, according to sources.
The media report confirms that the company has let go of 47 employees based on performance and is actively recruiting for critical functions such as growth marketing, product and sales. It is said that the founders of Open have also taken a 50 per cent pay cut.
Open, which became India's 100th unicorn last year after raising $50 million in a Series D round, had been expected to raise more funds in the last round but had to settle for $50 million due to tough market conditions.
The company managed to post significant revenue in the 2021-22 financial year, but it did not cross the Rs 50 crore ($6.6 million) revenue mark. Its operating collection stood at Rs 40.9 crore in the fiscal year 2022 (FY22) compared to Rs 5.7 crore in FY21, according to Open's annual financial statement.
The firm's losses also widened to Rs 167 crore from Rs 65.6 crore during the period.
The media report further claimed that Open has not given a severance package to the laid-off employees, but only one month's notice period worth of payment. "No notice or information, affected people are called into a meeting room and given a pink slip, post which they’re not allowed to get back to the office and are directly escorted to the ground floor or car park," said an employee who was impacted by the layoff.