Covid-19 impact: Bounce to lay off 22% of staff amid uncertainty2 min read . Updated: 30 Jun 2020, 03:33 PM IST
- The decision to lay off employees was taken after the startup was forced to suspended several planned business lines, products, and projects after changes in external environment
BENGALURU: Bike-sharing startup Bounce said it is laying off around 130 employees, constituting about 22% of its total workforce in the country, due to uncertainty for businesses and startups caused by the covid-19 outbreak.
Bounce’s co-founder Vivekananda Hallekere said in a blog post that the decision to lay off employees was taken after the startup was forced to suspended several planned business lines, products, and projects after changes in external environment.
Layoffs at Bounce also come almost two months after the mobility startup had earlier announced temporary pay cuts for its employees and 100% pay cut for the leadership team on 23 April. Bounce’s staff had agreed to forgo 20-60% of their compensation in April.
Outgoing employees from Bounce will however be repaid their pending salaries including the entire amount that was deferred in April, the startup said in its blog post. All employees leaving will be given a severance of three months’ salary, as per their original salary before the salary cuts.
Apart from pending salaries, outgoing employees will also receive three months of additional severance pay and a corporate health insurance plan that will be provided until the end of 2020. Employees who hold ESOPs can also redeem their stock options on a pro-rata basis.
“This decision is purely an outcome of a change in our business priorities and does not either reflect the unparalleled capability, performance, or dedication of any member of our team," Hallekere added in his blog.
The six-year-old startup has raised funding from prominent investors including Facebook co-founder Eduardo Saverin’s venture capital fund B Capital Sequoia Capital, Accel Partners India, Chiratae Partners, Omidyar Network, Vistra ITCL, SCI Investments, and Qualcomm Ventures.
Till date, the mobility firm has secured over $200 million from investors and is currently valued at more than $500 million, making it the biggest company in terms of valuation in the mobility segment in India.
Bounce currently operates a fleet of more than 23,000 two-wheelers in 35 cities. It has both dockless-bike sharing and long-term rental options. The startup also claims to have completed over 25 million rides in fewer than 18 months in Bengaluru alone.
The on-going global pandemic is expected to have a negative impact on the global economy. Mint reported earlier that urban mobility start-ups such as Bounce, Yulu, VOGO, Zoomcar and others that operate both two- and four-wheeler fleets are in for a rough ride, with the covid-19 outbreak and the consequent lockdown announced in India.
Bounce’s rival VOGO, which is backed by Sequoia and Ola also let go of employees across technology and customer care operations in April after many temporary contracts expired and as ridership dipped.