"Hits The Right Chords": Unacademy CEO's Reply On Startup Failure Before Mass Layoffs

Edtech startup Unacademy recently laid off around 250 employees in the latest round of job cuts at the company, as per a report in TechCrunch. A person familiar with the matter said that the Bengaluru-based firm, which was valued at $3.4 billion in its most recent fundraising in 2021, fired roughly 150 employees in sales and 100 employees in marketing, business, and product. Notably, the company has eliminated around 2,000 jobs overall due to the layoffs. A representative for the startup acknowledged the layoffs but did not specify the number of people affected. Amid this, CEO and co-founder Gaurav Munjal's comment on a post about startup failures just a day before layoffs has caught everyone's attention on social media.

On July 1, Mr Munjal commented on a post by Bhavin Turakhia, founder of Zeta, on X (formerly Twitter). In his post, Mr Turakhia explored the idea that one of the main reasons startups fail is "premature founder boredom." According to him, the ultimate objective of any startup is to develop into a "boring" company with steady profitability, expanding market share, and well-established internal procedures.

"A non-exhaustive list of Deliverables for a business to qualify as Boring - (1) Sustainable Profitability (2) Playbooks for every Process across every Function (3) Structured and continuously evolving training processes for industry, products and functions (4) Exploration of multiple traction channels (5) Sizeable and growing market share (6) Identification and realtime measurement of critical KPIs and relevant input metrics (7) Right Leadership (8) Effective Governance for keeping track of the critical KPIs," he wrote on the microblogging website.

The Zeta Founder added that entrepreneurs "fall in love with chaos, ambiguity and uncertainty" and it can begin to make them move away from their core business. Mr Turakhia concluded, "Founders fall in love with chaos, ambiguity and uncertainty (because variable rewards release dopamine) and can begin to detach themselves from their core business prematurely before it becomes Boring, resulting in distraction, lack of focus, inefficient use of capital, and inefficient use of the best people. Learn to relish the journey to becoming Boring."

Hits the right chords.

— Gaurav Munjal (@gauravmunjal) July 1, 2024

Replying to the same, Mr Munjal said, "Hits the right chords."

The company said in a statement, As part of our ongoing efforts to streamline operations and enhance business efficiency, we have recently undergone a restructuring exercise. This was necessary keeping in mind the company's goals and vision for the year, as we focus all our efforts on sustainable growth and profitability. Consequently, some roles have been impacted. While this transition won't be easy, we will be supporting all impacted individuals during this transition."

Meanwhile, in the last two years, Unacademy has reduced expenses while simultaneously growing its physical presence. The co-founder of the company stated last week in an X thread that an "offline play" was essential for building businesses in India.