Edtech startup Udayy has shut down its business and laid off its entire workforce of 100-120 employees. Launched in 2019 by Saumya Yadav, Mahak Garg, and Karan Varshney, Udayy was forced to shutter operations in the post-pandemic world as children return to the classroom.
For Udayy co-founder and chief operating officer Mahak Garg, the decision to shut down the edtech startup, which offered live learning classes to schoolkids, was “probably the hardest thing” she ever had to do.
In a post published on LinkedIn, Garg said that all employees, including teachers, were paid a generous severance package. The decision to shut down operations was announced in a company-wide town hall on April 4, she said, writing that the reaction of employees left her surprised.
“What followed the townhall left me both surprised and relieved,” she wrote. “More than being concerned for themselves, the team was concerned about us as founders.”
Several Udayy employees offered to join the trio’s next business venture, said Mahak Garg in her post. Some who had attended the town hall remotely especially travelled to office to meet the co-founders and bid them farewell in person.
“Over the next few days, several team members emailed and sent WhatsApp messages thanking us and sharing about their own unique growth stories within Udayy,” said Garg, sharing screenshots of some of the supportive messages she received from employees.
Garg said that the team worked hard over the next two weeks to refund customer money.
Co-founder Saumya Yadav also said that Udayy helped laid off employees find jobs in other companies. Nearly every employee found placement elsewhere.
Yadav said, “We have refunded money to all our customers and paid a generous severance to our team members and teachers. We have already helped place nearly 100 percent of our employees into new jobs at other promising companies. We are returning the remaining capital, around USD 8.5 million back to our investors.”
In her post, Mahak Garg said that high customer acquisition costs, Zoom fatigue and low retention all contributed to the shutdown.
“After several failed pivots in the last 6-8 months, we took the hard call to shut Udayy. Despite having several months of runway in front of us, we made this decision because neither did we want to burn investors' and LPs’ hard earned money nor did we want to waste teams’ time on a business which we knew was doomed to fail,” she wrote.
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