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Sharan Hedge, the founder and CEO of the financial education platform 1% Club, announced on LinkedIn that he has laid off 15% of his workforce. The move, which Hedge attributes to 'mistakes with hiring and redundant expenses,' marks the company's first cost-cutting exercise since its inception in 2022. The layoffs have sparked conversation, particularly in light of Hedge's position as a prominent financial influencer with a massive following of 2.7 million on Instagram.
Hedge addressed the concerns raised by his followers, acknowledging the irony of a finance influencer having to lay off employees. He emphasized that the company's financial stability is not in jeopardy, and the layoffs were necessary to streamline operations and focus on growth through AI-driven cost savings. Hedge also clarified that the company's expansion, including the construction of a 5,000 square foot office in Mumbai, was entirely funded by profits and that Rs 10 crore of investor funds remains untouched in fixed deposit accounts.
The decision to lay off employees has been met with mixed reactions, with some expressing support for Hedge's transparency and proactive approach to addressing the challenges faced by the growing company. Others have voiced concerns about the impact on the affected employees and the potential for further job losses. Despite the controversy surrounding the layoffs, Hedge has maintained that the company is committed to providing a healthy severance package to all laid-off employees and assisting them in their job searches. The move has also sparked discussion about the challenges faced by startups in navigating rapid growth and the need for careful financial planning to avoid potential pitfalls.
Source: Sharan Hedge Cuts 15% Workforce At 1% Club, Cites ‘Hiring Mistakes’