Similar to the United States, the Indian startup landscape has faced an extended period of financial challenges, leading to significant layoffs and job losses. According to data from CIEL HR, over 70 startups have laid off more than 17,000 employees in the first half of 2023 alone. Layoffs at Indian companies have surpassed 30,000 since the beginning of 2022, with prominent unicorn BYJU’s laying off an additional 4,000-5,000 employees. From the start of 2022 to the present, a total of 95 startups have let go of nearly 31,965 people, with several companies, including Dunzo, BYJU, and Cuemath, conducting multiple rounds of layoffs.
While the COVID-19 pandemic initially appeared to have a devastating impact on the global economy in 2019, it marked a prosperous era for the Indian startup ecosystem. Substantial investments flowed in, making Indian businesses a preferred choice for foreign investors. Indian entrepreneurs raised $13.2 billion in 2019 and $10.9 billion in 2020, showcasing the sector’s growth. In 2021, India witnessed a ‘unicorn’ boom, with companies raising a record-breaking $35.2 billion in investments, resulting in the birth of at least 34 unicorn startups. However, this golden period seems to have faded, as just two years later, the Indian startup sector grapples with significant financial challenges.