More Job Cuts Hit Startup Ecosystems Due to Coronavirus
A second wave of job cuts at Uber has seen the ride–hailing service lose another 3,000 of its staff because of the effects of the coronavirus pandemic. The announcement comes less than two weeks after it laid off some 3,700 of its global staff.
That means the embattled startup—once hailed for revolutionizing transport services globally—has cut about 25 percent of its total workforce, according to CNN.
And it’s not just Uber. Many startups have had to make painful job cuts in the wake of the COVID-19 crisis.
On Tuesday, online travel portal Agoda confirmed an earlier report that it had laid off 1,500 employees in about 30 countries as a consequence of a badly hit travel industry. The number is about 25 percent of its total employee count.
"We need to resize and reshape teams to adapt to what travel will look like in the future, and this means that we have taken the very difficult decision to reduce our existing team by 1,500 employees," Agoda CEO John Brown told Reuters.
Agoda, which is headquartered in Singapore, is a unit of American company Bookings Holdings Inc., which also owns Kayak and OpenTable. Both of those companies also reportedly furloughed or gave reduced hours to about 400 of their staff.
Meanwhile, restaurant aggregator and food delivery startup Zomato has also announced job cuts affecting 13 percent of its workforce. The India-based company did not mention exactly how many were affected but a spokesperson told tech website Techcrunch that its total workforce is about 4,000 and that the layoffs are global.
Zomato had announced an earlier round of job cuts in 2019 that affected 540 people.
While layoffs in virtually every industry have been an unfortunate side effect of COVID-19, startups have been particularly hard hit during the past few months. A running list on Business Insider reports job cuts in the following startups: Lyft (1,000 people), Envoy (30 percent of workforce), RigUp (25 percent), DataStax (15+ people), ZipRecruiter (“hundreds”), Bird (30 percent), TripActions (296 people), Wonderschool (75 percent), Away (60 people), ThirdLove (30 percent), Iris Nova (50 percent), Overtime (20 percent), Airbnb (1,900 people, 25 percent), OpenDoor (35 percent), Knotel (30 percent), Compass (15 percent), Convene (20 percent), and Zeus Living (30 percent).
As much of the world gradually reopens after being on lockdown the past few weeks, it’s tough to say whether conditions will begin to improve for businesses. Realistically, things might get worse before they get better.