Digital bookkeeping startup OkCredit has laid off about 40-45 employees as it realigns its focus to fintech initiatives from bookkeeping and e-commerce enablement, according to three people aware of the details. This is the first time the Lightspeed-backed firm is laying off part of its workforce.
“Over the past two weeks, the company has fired 35-40 employees,” said one of the people cited above requesting anonymity. “Affected staff have been given standard severance pay along with other benefits including insurance and outplacement services .”
According to sources, OkCredit has laid off anywhere between 30 to 35% of its total workforce. “The company used to have over 140 people but now it’s about 80 people. Most of the impacted employees are from growth and payments departments,” said another person who also requested anonymity.
This development comes at a time when most Indian startups are raising large sums of money and there’s a hiring bull market as well.
OkCredit provides bookkeeping and e-commerce enablement services for small and medium size merchants through separate apps. The company has raised close to $90 million and majorly competes with B Capital-backed Khatabook, Vypaar and a few others. It had raised a $67 million Series B round in September 2019, but the company hasn’t raised any follow on rounds since.
While the company didn’t confirm about how many staff members they asked to leave, it did confirm the change in the company’s priorities. “…Going ahead we will be focusing on fintech initiatives and on strengthening our growth channels alongside digital, in our mission to help Small and Medium Businesses grow their business in India,” said OkCredit spokesperson in a response to Entrackr’s queries.
“As a part of this strategy, we will be hiring talent with the relevant skill sets. This change in priorities also necessitated an assessment of our employee roles, and some restructuring has been deemed necessary, affecting some of our employees,” added the spokesperson.
OkCredit’s change in priorities is also evident from downloads numbers of OKShop and its core bookkeeping application. According to SensorTower data, OKShop’s download growth has been flat in the past six months. It has 40 million lifetime downloads with only 1.2 million coming in the past three months.
During the fiscal year ending March 2021, OkCredit remained a pre-revenue stage company. It made a meagre Rs 3.80 lakh in operating income with a loss of Rs 109 crore.