Fri. Mar 29th, 2024
UnacademyUnacademy

Two years before heading to IPO, ed-tech firm Unacademy has taken certain measures to conquer profitability and making frugality its core mantra. It has decided to slash leisure expenses and management salaries and shut down businesses, including Global Test Prep, to make the company run in profitability.

Founder and CEO Gaurav Munjal in an internal memo to employees announced that Unacademy staff would no longer be enjoying complimentary meals and snacks at the office. Employees, including top founders and top management, should forget about paid business class travel, and the facility of dedicated drivers for top executives will also not be there.

Munjal also said that the company should accept ‘frugality’ as a core value. Having said that! Founders have already taken salary cuts, and management will be next.

Munjal noted that Unacademy is not efficient at all, with crores spent on travel expenses for employees and educators taking a toll on the company. Munjal claimed that the company had over Rs 2,800 crore in the bank as of this morning.

“Until now we never had frugality as one of our core values…but now the goal has changed. We have to do an IPO in the next two years. And we have turned cash-flow positive. For that, we must embrace frugality as a core value. Even though we have more than Rs 2,800 crore in the bank, we are not efficient at all, ” Munjal said.

“Sometimes it’s (travel is) needed, sometimes it’s not. There are a lot of unnecessary expenses that we do. We must cut all these expenses. We have a strong core business. We must turn profitable asap,” Munjal said.

He said that such frugal steps may show the company in a bad state but it is not the case.

“We are in a great state. This is the final frontier that we have to conquer. Profitability. And once we do, it will change the game for us. We are well-capitalized but still, we want our business to be profitable,” Munjal said.

Earlier, Munjal sent a note to his employees in May, wherein he warned employees of a potential ‘funding winter’ and had asked them to work under tight situations.

“We are looking at a time where funding will dry up for at least 12-18 months. Some people are predicting that this might last 24 months,” Munjal had said on May 26.

It is to be noted that, three months ago, Unacademy in an effort to save costs and be more efficient, laid off 600 employees or about 10 percent of the overall staff because of their non-performance and role redundancy.

By Harshita Sharma

I bring to you updates from business, policy and economy spectrum.

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