- Livspace, Bengaluru-based home design, and decor service provider lay off 15 percent of its total staff, i.e. more than 450 employees out of 2,800.
Livspace, Bengaluru-based home design startup lays off More Than 450 Employees & Cuts Down Extra Expense decor service provider have laid off 15 percent of its total staff, i.e. more than 450 employees out of 2,800. The development comes almost a month after the company said it did not make any wage cuts or layoffs related to Covid-19 but the effect of prolonged lockdown has now led the company to resort to layoffs.
The company that Anuj Srivastava, Ramakant Sharma, and Shagufta Anurag founded in 2014 offering end-to-end home design experience for homeowners and home designers alike. There are three companies in the Livspace Group – home interior, e-homemaker, and Livspace Pte.
Earlier, the company raised $157.6 million in funding from investors like US-based venture capital firm TPG Growth, Goldman Sachs, Jungle Ventures, Bessemer Venture Partners, and Helion Ventures, as well as IKEA furniture retailer. With its Series D sponsorship, it was reported to be on its way to joining the unicorn group.
Srivastava clarified that despite both founders having let go of 70 percent of their salaries, and despite incentive cuts across the board for the leadership team and success-based variable compensation, further action will be required to resolve the slowdown. “Livspace has also encountered a sudden and unexpected effect on business because of the Covid-19 pandemic, like any company in the discretionary purchasing market. Owing to the shutdown, our experience centers, and last-mile operations were affected and as the shutdown ends, we are also restarting our operations, “Srivastava told us.
He added that the company is seeing a more volatile road of recovery, the markets are still very uncertain and the emphasis is on taking a leaner direction. Srivatsava also said the company cut to stretch runway approximately 25 percent -30 percent of its expenses.
Livspace CEO added that it is forecasting profitability with the amount of capital it has in the bank and will be “capable of handling its destination.” “And we are lucky to be well-capitalized and to be able to forecast profitability at this point, and for us, at this point, it is not a matter of 18 to 24 months,” Srivastava said.
The co-founder said the company has cut marketing and branding costs to near zero in the past two months. The business is now expanding its tech infrastructure, investing more in the sector and supply chain, and prioritizing opportunities for growth.
Srivastava said during the lockdown that the company was unable to offer its services, but had a strong interaction with users who are interacting with the designers of the product to work on their homes. “So at this point, we ‘re just making sure we can turn the business we have into hope, beginning with Bengaluru and Gurugram and opening up more cities
Srivatsava also said the company’s topline growth in FY20, the year ending March 31, 2020, was 90 percent -100 percent. Consolidated in FY19, Livspace ‘s income was INR 191 Cr with INR 349 Cr expenditures leading to INR 158 Cr losses. In the background, consolidated revenue for FY18 was INR 105 Cr for the firm, with INR 206 Cr expenses and INR 101 Cr losses.
“There might be more layoffs in the upcoming days. The company has revised the salary structure and the variable salary has been revised. Designers have taken the most burn of this change. If the situation worsens, more layoffs are a possibility among remaining Livspace employees”, said people aware of the matter to Next Big Brand