The layoffs in the Indian startup ecosystem due to the COVID-19 induced economic slump is yet to go away. Bengaluru-based mobility startup Bounce, said it was letting go of 130 employees, or one-fifth of its total team strength, as it’s figuring out its business priorities.
In April, the company had announced salary cuts to avoid laying off its employees. The three founders, Vivekananda Hallekere, Varun Agni, and Anil Giriraj took 100% pay cut, while the rest of the employees had agreed to 20% to 60% deductions from their salary in exchange of employee stock ownership plans.
“Unfortunately, the way the external environment has continued to shift means our medium-term workforce needs have changed as several new business lines, products, and projects we had planned will have to either transform or be put on hold in the coming quarters,” Hallekere, co-founder and CEO, Bounce noted in a blog.
“While we cannot know the future, our hope is that these cuts are sufficient to put us on a strong path to continue through the next period of global uncertainty and change,” he added.
In the face of the long-term impact on the mobility space resulting from the global healthcare crisis, bike-rental companies have started exploring short- to mid-term subscription models instead of renting the two-wheelers for every ride. In May, as India began relaxing the lockdown in a phased manner, Bounce and its competitor Vogo started offering subscription plans ranging from a month to three months to its users.
Earlier this year, Bounce raised USD 105 million in its Series D funding round led by existing investors, American venture capital firm Accel and B Capital, which is backed by Facebook co-founder Eduardo Saverin. In March, it followed up with another round of funding of USD 6.5 million in venture debt from InnoVen Capital.
Another Bengaluru-based mobility company Yulu, that claims to see a V-shaped recovery, announced USD 4 million funding from US-based Rocketship.vc.
“In the first week of May, when the lockdown was partially lifted, we started the service and witnessed a good uptick in usage. Since we don’t have drivers or a co-passenger, we believe it’s the best and safest option to commute compared to buses or taxis,” Amit Gupta, co-founder and CEO at Yulu, told KrASIA. Initially the company recorded 15-20% increase in users every month, which has increased to 40% post-lockdown, he added.