Edtech startup Skill-Lync, backed by Iron Pillar, lays off over 400 employees

• ByStartupStory     |    April 26, 2023

Skill-Lync, an upskilling startup based in Chennai that offers job prospects to its students post-program, has joined the list of edtech startups that have laid off employees due to funding constraints. The startup, with a LinkedIn page indicating a headcount of over 2,000, recently underwent a restructuring exercise that resulted in the termination of more than 400 employees, according to sources familiar with the matter.

In an internal email, SuryaNarayanan PaneerSelvam, co-founder of Skill-Lync, informed the impacted employees about the recent layoffs and cited “macroeconomic conditions” as the reason. The email, which has been accessed by Inc42, stated that the decision was not based on individual performance. The affected employees were from various departments, including sales, marketing, pre-sales, tech, and talent acquisition. Skill-Lync provided severance packages to the laid-off employees depending on their notice periods.

According to sources, Skill-Lync has shut down its Delhi NCR office following the recent layoff round. The startup had previously closed its Mumbai and Pune offices and let go of approximately 300-400 employees. In a statement to Inc42, Skill-Lync confirmed the recent layoffs and cited “macroeconomic conditions” as the reason for moderating its growth expectations and slowing down future projects. Co-founder SuryaNarayanan PaneerSelvam also mentioned that the company has consolidated its operations in Chennai, Bengaluru, and Hyderabad, with only corporate-facing teams operating from Pune/Delhi, which resulted in some headcount reduction. Additionally, the startup has reduced its hierarchy for more agile decision-making and accountability.

Sources suggest that Skill-Lync has been facing a shortage of capital due to the ongoing funding winter since November 2022. According to an email reportedly sent by co-founder PaneerSelvam, the startup had INR 120 Cr in the bank, with expenses of INR 35 Cr per month and revenue of INR 26 Cr. However, the accuracy of this information could not be independently verified by Inc42. In November 2022, Skill-Lync reportedly placed a significant number of employees from its sales and pre-sales team on a performance improvement plan (PIP) and set “impossible” targets for them. After the completion of the PIP period, many employees were let go based on their performance towards the end of 2022 and the start of 2023. The startup subsequently fired its entire L&D and quality teams, according to sources. In total, before the most recent round of layoffs, around 300-400 employees were terminated due to performance-related issues.

Skill-Lync, founded in 2015 by PaneerSelvam and Sarangarajan V, competes with various upskilling platforms such as Great Learning, Coding Ninjas, Hero Vired, Pesto Tech, and Scaler Academy. It offers online and offline upskilling courses, including an 8-12 month online master’s program and a shorter six-month offline course. The startup has been struggling with mounting losses, with its net loss increasing from INR 24 Cr to INR 140 Cr in FY22. 

However, its revenue from operations rose to INR 46.7 Cr in FY21. Skill-Lync raised $17.5 Mn in its Series A funding round in August 2021, led by Iron Pillar, with participation from Y Combinator and Better Capital. It previously received investment from Flipkart co-founder Binny Bansal and acquired online learning platform Crio in November 2022. The ongoing funding winter has hit the edtech sector hard, with 19 edtech startups and over 9,000 employees, including unicorns like BYJU’S, Unacademy, and Vedantu, being impacted since the start of 2022.

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