Hirings cool, layoffs pick up as startups save cash, turn to AI

Startups chasing profitability or aiming for a public listing appear to have gone slow on hiring.

- Ranjani Raghavan & Devina Sengupta

Startups chasing profitability or aiming for a public listing appear to have gone slow on hiring. The companies have hunkered down and tightened their belts to save money and figure out how artificial intelligence (AI) will change their work.

Some companies have also let people go or reassigned roles as they dropped new non-core businesses that simply weren't working or to improve organizational efficiency.

Big tech-enabled names like Zomato, Cars24, and Gupshup have cut jobs over the past quarter, while others such as Swiggy and Flipkart have pruned divisions and moved staff to other roles. Newer startups are also being more careful about who they hire because investors want to see profits.

Vikram Chopra, co-founder and chief executive officer of used-car platform Cars24, said the firm had "refined" its project list and will focus on core engines such as its used car platform, lending, and international business. "We don't anticipate doing a lot of hiring," he told Mint. "However, we continue to seek out exceptional talent in business, product, and technology."

In a 26 April blogpost, Chopra had said that Cars24 had initiated layoffs for around 200 executives not because of performance, but structure. "Over the last few months, we realized that some projects did not deliver what we expected. Some roles were added too early. A few hypotheses simply didn't hold when tested. And in some cases, we couldn't offer the kind of growth or learning that people truly deserve," he wrote in the blog.

Anusha Mallana, head of talent acquisition at quick commerce major Zepto, said the startup is not hiring as aggressively as last year, "since we doubled our workforce in under eight months in 2024 at one-tenth the typical acquisition cost". On redeployment of talent, she said the company has seen interested junior tech executives moving to data science.