Koo, a home-grown microblogging app that competes with Twitter, has been struggling with losses and the inability to raise funds and has now laid off almost a third of its 260 employees in recent months.
What Happened? A spokesperson for Koo, while speaking to Bloomberg, said that the company had to focus on efficiency, and the layoffs were necessary to prove unit economics.
Initially, the Bengaluru-based company benefited from Twitter’s controversy with the Indian authorities over the content on its platform. Many citizens, including government officials, cricket stars, and Bollywood celebrities, turned to Koo as a local alternative.
However, the current struggle to access cash comes amid a global rout for technology companies and depressed investment activity that has slashed billions from the valuations of once high-flying startups.
Tiger Global-backed Koo has more than 60 million downloads, and the company is “well capitalized,” according to co-founder Mayank Bidawatka. He added that the company has one of the highest revenue per user among other social media companies. Koo is striving to become profitable with monetization experiments.
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Koo had raised funds at a valuation of $273 million (₹2,243.66 crore) last year, according to research firm Tracxn. The startup has supported the dismissed employees with compensation packages, extended health benefits, and help finding new jobs.
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