Indian game streaming platform Loco has laid off about 40 employees, which constitutes 36% of its total workforce. According to an ET report, which first reported the development, The layoff decision was announced in a town hall meeting.
What caused the layoffs?
While several elite startups, including Byju’s, have laid off a significant number of employees, citing cost-cutting measures and goals of achieving profitability, Anirudh Pandita and Ashwin Suresh have explained similar reasons.
The founders said that the layoffs at Loco are not based on performance but are part of the company’s restructuring plan, focusing on transaction-based monetization and a leaner cost structure to ensure long-term sustainability.
“We want to focus on core objectives like monetisation. This led to people losing jobs. It is not performance based. From our perspective, the transaction programs are doing well than advertising we have focused on the merit of the product. We had to take the hard decision. These people were with us for a long time. But we had to make this decision for the benefit of the company, Anirudh Pandita, Founder, Loco.
Focused on monetization and global expansion
The startup said it is now pivoting towards core objectives, primarily monetization. The shift includes the discontinuation of non-core initiatives and experiments. Loco’s founders have reportedly highlighted the importance of this strategic review in ensuring the company’s health and long-term sustainability.
Additionally, Loco is eyeing expansion into international markets, including West Asian and Latin American countries, despite not officially announcing its entry into these regions.
Company assures financial assistance
Loco’s founders said the company will support the laid-off employees by providing financial assistance, ongoing health insurance, and outplacement services. They also asserted that the company has no immediate plans for further layoffs and is focusing on enhancing its VIP program and monetization opportunities.
“We deeply care about the people leaving us and will provide them with financial support, ongoing health insurance, and outplacement services. The reorganization will impact approximately 40 people from our team, and we remain grateful to them for their contribution towards Loco’s journey,” Anirudh said.
Drop in user engagement rate
Despite some reports of a drop in monthly and daily active users, Loco’s founders refute these claims, citing significant growth in user metrics following the launch of their VIP program and esports series.
The founders said the platform has six million monthly active users (MAUs) and 800,000 daily active users (DAUs), with the VIP program contributing to 3% of the MAU base.
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