Meesho Has Decided To Lay Off About 251 Employees Due To Some Judgemental Errors In The Hiring Process, According To The CEO
Meesho has decided to lay off about 251 employees, or about 15 percent of their workforce. This will mark another round of the company cutting jobs at their e-commerce firm as they seek profits and reduce costs.
Meesho is a Bengaluru-based firm, and they have been informing their employees about the layoffs in a town hall. The co-founder of Meesho Vidit Aatrey, the company’s chief executive, stated that he admits there may have been some judgemental errors in over-hiring in a letter he wrote to his employees.
He also added that the company has grown at the rate of 10x from 2020 to 2022 due to the company’s aggressive investments and the covid tailwinds. Even though we tried to track our plans, the macro climate considerably and undeniably changed.
All of these circumstances led us to accelerate the timeline of our profitability. Our cash reserves will protect us right now. Still, according to the Business Standard, we must remain extremely frugal with our spending under these trying conditions, as mentioned in Vidit Aatrey’s letter.
Being in a leadership position, we undoubtedly committed mistakes by recruiting too many people too soon. At the same time, we could run the structure of our organization in a lean and more effective overall. Our layers and spans were inflated, and this could have been the consequences that were purely unintended by our speed of execution.
In April of 2022, Meesho downsized its vertical of grocery items and laid off about 150 employees from the firm. Also, various media reports state that the number of employees impacted by this situation was about 400.
The company was also able to raise funding of about $1.1 billion from its investors, which include Prosus, Facebook, and SoftBank, at a valuation of around $4.9 billion. A Meesho representative added that the company had made the decision to split ways with 251 Meeshoites, who typically make up around 15% of its workforce.
We are highly committed to ensuring that all the people that this decision has impacted get our full support. These people wil be provided separation packages, including a one-time severance payment of 2.5 to 9 months, which will highly depend on their designation and tenure.
This will also include continuing insurance benefits, accelerated vesting of ESOPs, and job replacement support. The company will always be grateful for the contribution of these people towards the company.
Many employees of the company have decided against relocating to Bangalore recently. Employees who moved to Bengaluru from January 2023 till May % will receive the required reimbursement based on their current relocation.
The amount equivalent to the claim amount will be paid as an allowance to all employees to cover all the costs required for their relocation back to their hometown. The company is trying everything from its side to deal with the current situation and make it easier for the employees.