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Bootstrapped SaaS Startup Lays Off 11 Percent Of Workforce

By Nithya Bose in Business News, posted June 12, 2024

Chennai-based startup Kissflow has announced a restructuring that has resulted in the layoff of about 45 employees, almost 11 percent of its workforce.

The company said the cuts, which impact staff in India, the US, and the UAE, were implemented over April and May.

Founded in 2012, Kissflow offers cloud-based no-code and low-code work management solutions.

Before the layoffs, the company employed around 400 people.

Kissflow’s founder and CEO, Suresh Sambandam, said: "We let go of around 20-25 people because we moved away from land-motion procurement to expand motion; this was done to increase customer acquisition across our products.”

Additionally, another 20 positions were eliminated following performance reviews.

Kissflow gained attention in 2022 for its unique employee appreciation gesture: gifting key staff members 5 Series BMWs worth Rs 1 crore each.

Despite the recent layoffs, the company provided severance packages to all affected employees.

Sambandam said: “Every company is looking to optimise and 90% of people who were laid off (by Kissflow) are already placed in companies and the rest 10% will also be placed soon.”

The development was initially reported by MoneyControl.

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The global software-as-a-service (SaaS) industry has faced significant challenges in maintaining the growth levels seen in 2021 and 2022, driven by the post-Covid digitization boom.

The sector has experienced extended sales cycles, multiple layoffs, and companies cutting margins to attract and retain clients.

A report by SaaSBoomi, a collective of SaaS and product company founders, revised the 2030 enterprise value projections of Indian SaaS startups from $1 trillion to $500 billion.

The report suggested that the recovery of enterprise value corrections might only occur by 2030.

Additionally, a joint report by global management consulting firm Zinnov and venture capital firm Chiratae Ventures last year reduced the 2026 revenue projections for Indian SaaS startups from $100 billion to $26 billion.

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