Game streaming firm Loco lays off 36% of staff as it eyes leaner cost structure

Loco's founder Anirudh Pandita said that the company has no plans of any other layoffs (representative image)

Game streaming platform Loco has let go off 40 of its employees, laying off 36 percent of its total staff strength of 110 people.

The company said that it has taken this decision as it focuses on a leaner cost structure.

“We recently launched Loco VIP program, which is a transaction-based program which has done well. And as we were reviewing our strategy, we decided to focus on transactions and thought that this is a structure that is sustainable. We want to focus on core objectives like monetisation. This led to people losing jobs. It is not performance based. From our perspective, the transaction programs are doing well than advertising we have focused on the merit of the product. We had to take the hard decision. These people were with us for a long time. But we had to make this decision for the benefit of the company, Anirudh Pandita, Founder, Loco, told Moneycontrol.

Pandita added that the decision has been taken to ensure the long-term health and sustainability of the company. “We deeply care about the people leaving us and will provide them with financial support, ongoing health insurance, and outplacement services. The reorganization will impact approximately 40 people from our team, and we remain grateful to them for their contribution towards Loco’s journey,” he said.

He said that most teams have been impacted due to the recent layoffs. “The engagement led initiatives, people in other support teams like marketing, technology who were supporting those initiatives were impacted the most. Other people like finance and other teams were part of this layoff.”

The founder said that the company has given everyone who have been laid off a severance pay for 60 days. “We are also helping them with placement service for each of them. We hope to place a lot of them in jobs in next 60 days. There is health insurance till January.”

He added that the company has no plans of any other layoffs.

Loco recently introduced a VIP program in a bid to enhance monetisation opportunities for the platform.

The VIP programme has recorded over 1 lakh paying users in under 60 days of launch and currently the number is approximately 3 percent of the platform’s monthly active users (MAU), which is higher than global standards for these platforms, the company said.

“We did an esports program which was for VIP subscribers only. That did well. Transaction-based monetization allows us to have a cost effective streaming solution. For streamers, if 500 people are watching them on YouTube, there is no ad money but on Loco they can get money from subscriptions. This is an interesting new model. The big streamers get money through brand engagements but the smaller streamers get neglected in the ad model. Also, UPI is a big advantage,” Pandita said.

Reportedly some of the employees said that the platform saw drop in MAUs and daily active users.

Pandita said that the platform currently has close to 60 lakh monthly active users (MAUs) and 8 lakh daily active users (DAUs).

Earlier this month, the platform had recorded over six crore users, over one crore MAUs and more than 20-30 lakh DAUs.