Chargebee Technologies Ltd. has fired 10% of its workforce, becoming the latest in a series of venture capital-backed companies to cut jobs in a tough macroeconomic environment.
The decision was not made lightly and was actioned by the “economic situation and lack of visibility into the future”, said Krish Subramanian, co-founder and chief executive officer at the San Francisco and Chennai-based startup.
Subramanian, in a LinkedIn post late on Wednesday, said he was driven by external market forces as well as the need to address the operational debt that have accumulated in the last few years. Macroeconomic factors began impacting public companies and the financing environment from the start of second quarter, he said.
“We changed our hiring plan to align with priorities and started implementing stricter fiscal discipline to reorient the company towards long-term sustainability,” Subramanian said. “Since then, the global economic environment has continued to be uncertain — but it is clear that this new reality will require companies to move toward profitability at an accelerated pace.”
He said the layoffs are the latest measure in a series of moves aimed at reducing spending. “Our years in high-growth mode have created operational needs across the company, which is impacting our ability to execute,” he said. “Facing a growing gap between our revenue and spend, we have been reducing our expenses across various areas including tools, consulting, and contractors, etc.”
“Today, the scale at which we are operating makes it very difficult to control expenses with costs that increase with each individual, including programs they need to be successful in their jobs.”
Chargebee remains well capitalised to grow in the long term, he said. “Although we still face uncertain headwinds, I want to reinforce my belief in our long-term market opportunity. The global SaaS market is still forecasted to grow significantly…The vision for our product remains strong and we will continue to rise to meet the multitude of market opportunities in the long term.”
Subscription billing and revenue management platform startup backed by marquee global investors such as Tiger Global and Sequoia, turned unicorn in April 2021. It has now become the latest in a series of VC-backed companies that have cut jobs in attempt to reduce spends as access to capital tightens. Bloomberg