Chiratae-backed healthtech startup Healthifyme has laid off 150 employees, about 15 to 20 percent of its workforce, to focus on profitability amid "changing market dynamics", the company has said.
HealthifyMe said the decision came as its growth did not match its expectations and hiring activity at a time when many new-age startups had let go of employees to shrink costs with uncertainty around how long the funding winter would last.
"We have had to take the tough decision to let go 150 of our team members. Like much of tech, growth hasn't kept pace with expectations and hiring," the company said in a statement on December 4.
Healthifyme has joined a growing list of technology companies resorting to layoffs amid macroeconomic headwinds. In India, technology startups have let go of close to 18,000 employees since the start of 2022.
News agency Inc42 first reported the sackings on December 3 at Healthifyme, saying employees from SME (subject matter expert), quality analytics, product, and marketing roles were affected.
“We are also undergoing an evolution with our new vision around metabolic health (HealthifyMe 2.0) which requires different resources. In view of this and changing market dynamics, it made sense for us to steer toward profitability, despite a comfortable runway,” Healthifyme added.
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A Bengaluru-based health and fitness startup, Healthifyme has offered a severance package of two months with two weeks per year served at the startup to the laid-off employees.
The company said it would also provide the vested stocks till March 2023, while medical insurance would continue till June 2023. It has offered counselling and outplacement support to those affected.
Founded in 2012 by Tushar Vashisht and Mathew Cherian, Healthifyme delivers measurable results on eating habits, fitness, and weight by tracking lifestyle, providing access to diet and workout coaches and through its artificial intelligent nutritionist.
In July 2021, the startup raised $75 million in a Series C round led by US-based LeapFrog and healthtech-focused venture capital firm Khosla Ventures.
HealthQuad, Unilever Ventures, and Saudi Arabia-based public investment fund Elm also participated in the round along with existing investors Chiratae Ventures, Inventus Capital, and Sistema Asia Capital.
The startup clocked an operating revenue of Rs 185.2 crore in FY22, recording 115 percent growth over Rs 86 crore in the previous fiscal. However, the net loss for also blew up by over eight times to Rs 157 crore in FY22 from Rs 19 crore in FY21, according to the ministry of corporate affairs website.
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