Mohalla Tech Pvt. Ltd, which operates the short video service Moj and social networking platform ShareChat, supported by Temasek and Google, announced the shutdown of its fantasy game site Jeet11 on Friday, laying off around 5% of its employees.
The layoffs will affect more than 100 employees when practically every digital firm is reshaping businesses to withstand the global financial crisis.
The sources claimed that most laid-off workers were in non-technical roles and that Moj and ShareChat would take over the platform’s technical staff.
The operational efficiency and layoffs efforts are part of a larger trend in the business where startups focus on operational efficiencies and tight cost control to stretch their pathway to resist a potential recession and weather the funding winter.
Notably, the developments at ShareChat occurred just over five months after the business disclosed a $255 million fundraising round from a slew of high-profile investors, including Times Group, Google, and Temasek. It was one of the most valuable startups in the country after the multi-tranche investment round of $520 million valued the company at $5 billion.
Other prominent investors in the startup include Lightspeed Venture Partners, microblogging behemoth Twitter, India Quotient, Morningside Venture Capital, and Elevation Capital, to mention a few.
Early in 2020, Mohalla Tech released Jeet11 to explore the fantasy game market. It was developed to compete against bigger players like Mobile Premier League (MPL) and Dream11.
Since fantasy game apps are not approved on the Google Play Store, ShareChat shares Jeet11 through Xiaomi’s GetApps software store on its website. The app or its website doesn’t mention its relationship to ShareChat.
In addition, according to Indian rules, Jeet11 requests its customers to verify that they do not reside in places such as Arunachal Pradesh, Assam, Sikkim, Odisha, or Telangana, which have banned fantasy sports betting. Despite claims by ShareChat of making inroads into smaller Indian cities, Jeet11 never achieved considerable popularity among its users.
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Along with the ShareChat app, ShareChat (Mohalla Tech) also operates the short video sites TakaTak and Moj, which serve over 400 million people. The company has also developed a variety of revenue streams outside of advertising, including video commerce and virtual gifting.
ShareChat, launched in 2015 by Farid Ahsan, Bhanu Pratap Singh, and Ankush Sachdeva, owns various social media brands. Presently, ShareChat asserts that it has more than 180 million active users nationwide each month. More than 16,000 workers in the startup sector have been laid off so far this year, but consumer Internet firms have accounted for the majority of the layoffs.
In the content industry, Dailyhunt, which runs a smart video app Josh and a news aggregation product, laid off 150 staff last month, or approximately 5% of its workforce, noting changes in the economic situation. Similarly, SoftBank-backed edtech unicorn Unacademy last month let off 10% of its employees, or approximately 350 individuals, in the third wave of layoffs in a year, reflecting the edtech sector’s never-ending troubles.
Companies in the digital area may resume hiring by the middle of next year to drive their future growth, they added.
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