Neobank Open Lays Off around 50 Employees

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Indian neobanking platform Open has reportedly laid off close to 50 employees as it looks to cut costs and extend runway in the current market conditions. Open’s founders also took a 50% cut in their salaries. While Open confirmed the layoffs and the salary cut, it said that only 47 employees were let go based on performance evaluations. The firm is actively recruiting for critical functions such as growth marketing, product, and sales. The company, which became India’s 100th unicorn last year after raising $50m in its Series D funding round, posted revenue of less than INR50 crore ($6.7m) in fiscal year 2022, according to its annual financial statement.According to Open’s annual financial statement with the Registrar of Companies (RoC), the company’s operating collection stood at INR 40.9 crore ($5.5m) in FY22, compared to INR 5.7 crore ($0.8m) in FY21. However, despite the increase in revenue, Open did not cross the INR 50 crore ($6.7m) revenue mark in FY22. The company’s losses widened to INR 167 crore ($22.3m) from INR 65.6 crore ($8.8m) during the period. Neo banking platforms in India have struggled to make money despite raising millions of dollars during the 2020-2022 period. Like Open, Stashfin, Fi and Jupiter also couldn’t go past Rs 50 crore mark in revenue in the fiscal year ending March 2022. The neo banking sector in India has been facing challenges in making profits despite raising millions of dollars during the 2020-2022 period. Other neobanking platforms in India, such as Stashfin, Fi, and Jupiter, also struggled to cross the INR 50 crore ($6.7m) revenue mark in the fiscal year ending March 2022. This indicates that the neobanking sector in India is still in its early stages and may take some time to become profitable.