Why 2017 was a year of mass layoffs, firings & resignations for startups

Uber CEO Travis Kalanick speaks to students during an interaction at the Indian Institute of Technology (IIT) campus in Mumbai, India, January 19, 2016. REUTERS/Danish Siddiqui/File Picture

From Travis Kalanick of Uber, CXOs of companies such as Jabong and Freecharge to over 2,000 employees at Snapdeal who lost their jobs, the year 2017 saw major exits and layoffs in the startup world.

2017 was also a year that opened a pandora of sexual harassment cases across startups such as Scoopwhoop, TVF, Uber and 500Startups.

Dave McClure, CEO of 500 startups admitted himself to be a 'creep' in a blog while Steve Jurvetson of DFJ stepped down after accusations of sexual misconduct.

Travis Kalanick, founder of Uber also resigned after an ex-employee Susan Fowler claimed sexual harassment by a company senior executive in a blogpost.

Here are the top resignations and exits from the startup world in 2017:

Travis Kalanick, co-founder and ex-CEO of Uber

Departure announcement:  June 2017

Reason for departure- Kalanick was forced to resign as the CEO of Uber as the board members and investors tried to tackle multiple damaging controversies over sexual harassment and toxic work culture.

Steve Jurvetson, co-founder of VC firm Draper Fisher Jurvetson (DFJ)

Departure announcement-  November

Reason for departure- Jurvetson resigned from his own company after the charges of sexual harassment levied on him. He also went on a leave of absence from SpaceX and Tesla boards in 2017.

Also Read: Five entrepreneurs who were asked to leave their own company

Eric Alexander, former Head of Business in Asia

Departure announcement- June

Reason for departure: Alexander was fired amidst a controversy over his reported acquisition of the medical records of a woman who was raped inside an Uber cab in Delhi. Alexander apparently shared the records within and outside Uber.

Eric Schmidt, former executive chairman of Alphabet

Departure announcement- December

Reason for departure- Schmidt tweeted "adult supervision no longer needed," a reference to a comment Google co-founder Sergey Brin.

He will continue to serve on the company's board and transition to a technical advisor.

Shervin Pishevar, cofounder of Sherpa Capital, Virgin Hyperloop One

Departure announcement- December

Reason for departure- Pishever had taken a leave of absence after being accused of sexually harassing six women in professional context.

Justin Caldbeck, cofounder of Binary Capital

Departure announcement-  June

Reason for departure-  Caldbeck resigned from the company after he was accused of sexually harassing six female founders. They claimed unwanted advances by Caldbeck, including groping and late-night texts.

Caldbeck wrote in his statement that the past "24 hours have been the darkest of my life," and said that he will seek professional counseling.

Dave McClure, former CEO of 500 Startups

Departure announcement- July

Reason for departure- McClure was accused of sexual harassment from multiple women in the tech industry. He publicly apologised for being a 'creep' and stepped aside from 500 Startups.

Mahesh Murthy, cofounder of Seedfund

Departure announcement- May

Reason for departure- Mahesh Murthy exited the digital media startup - 'The Ken' by selling his stake to a private investor. He was in the news for alleged sexual harassment charges made by some women including author Rashmi Bansal on social media.

Arunabh Kumar, former CEO of The Viral Fever (TVF)

Departure announcement- June

Reason for departure- Arunabh Kumar was accused of molestation and sexual harassment in an anonymous blog post called the Indian Fowler, reminiscent of Susan Fowler moment in Uber.

A series of other such complaints surfaced from other women, some of whom also filed a formal complaint or posted on social media against Kumar.

Other major exits in Indian startup world related to upheaval in companies, mergers and acquisitions: 

Anup Vikal, ex-CFO of Snapdeal

Departure announcement- October

Reason for departure: Vikal's exit comes soon after private lender Axis bank completed the acquisition of Freecharge, while holding back an amount of around Rs 80 crore, due to pending regulatory approvals.

Govind Rajan, ex-CEO Freecharge

Departure announcement- February

Reason for departure-Freecharge was put on the block by Snapdeal to raise funds to survive after Softbank backed out to put in additional funds inside the Gurgaon based company.

This led to mass exits inside Freecharge. Ex-Housing executive Jason Kothari was put in charge of Freecharge, which was sold a few months later to Axis Bank for about Rs 385 crore.

Vinod Abrol, former CFO, Jabong

Departure announcement- December

Reason for departure- Abrol's departure comes at a time when Flipkart is trying to merge all functions including finance and HR of Jabong with Myntra.

Several CXOs are either seen moving out of the company or being re-designated across group companies. The chief financial officer Vinod Abrol who was in Jabong since 2013 is also moving out of the company.

About 2,000 employees laid off from Snapdeal

Restructuring announcement-January to April

Reason for layoffs-Snapdeal which was expected to raise a large round from Softbank in 2016-17, failed in its efforts.

This led to efforts from top management to save the company and reduce its burn rate by consolidating offices, laying off employees and shutting down non-core businesses. This also led to sale of Freecharge by Snapdeal to Axis Bank for about Rs 385 crore.