What is wrong that Edtech companies are laying off staff?
Answer
Answer
Last week Vedantu laid off 200 employees or 3.5% of its workforce. This follows other leading Edtech players in India like Unacademy and Lido Learning; both of whom laid off a large number of employees. Edtech players call it routine, but it is not that simple. Clearly, most of the Edtech companies are having their tryst with reality.
Interestingly, Edtech companies have to now downsize revenue estimates after the recent reopening of schools across India. That will reduce demand for online learning. Liberal funding from global PE investors has slowed, if not stopped. The US tightening is only worsening matters for these Edtech companies.
There are complaints that students are not getting value and parents are unhappy with the value add. One only hope they don’t go down the same path as Educomp, Everonn and Tree House in the past.