Unacademy opts for cuts in the brand’s marketing budget

Ed-tech platform Unacademy has slashed its brand marketing budget significantly as part of its cost-cutting exercise to conserve cash following cutbacks in investments by private equity (PE) firms and venture capital (VC).

In an internal letter to employees, Unacademy co-founder and CEO Gaurav Munjal said employees need to learn to work under stress and focus on profitability. He also suggested that funding winter has arrived and new funding will be hard to come by for at least 12-18 months.

“Tech stocks around the world are crashing and burning due to tighter monetary policies and rising interest rates. We are looking at a period where funding will dry up for at least 12-18 months. it could be 24 months,” he said. indicated in the communication.

Munjal listed the key steps taken by the company to achieve profitability. In addition to a reduction in brand marketing spend, Unacademy will focus on organic growth channels.

He also said that every test prep category handled by Unacademy must become profitable within the next three months. Unacademy centers, he added, are expected to be profitable in FY23 with companies like Relevel and Graphy, which are in blitz scaling mode, having to become extremely mindful of Burn and scale it down. in a significative way.

All incentives for educators that are not tied to income have either been removed completely or are in the process of being removed completely, he revealed. Munjal also urged employees to travel only when absolutely necessary. Meetings that save travel costs and can take place on Zoom should take place on Zoom, he noted.

Munjal said Unacademy has never been resource constrained as it has always raised more money than needed. This, he said, allowed him to experiment and continually develop the platform without worrying about a lack of funding.

“It also allowed us to create the right product and monetize in the right way. We said no to selling courses on a USB drive or building a field sales team because we wanted to be a product company. And scale as one. We wouldn’t have been able to do this if we didn’t have the right funds,” he said.

He also highlighted the fact that monetization through the subscription product has allowed the platform to experience true product-driven growth. “We thrived in an environment where resources and capital were abundant. There were times in 2018-19 when we struggled to raise funds, but the business was not impacted because, as Still, we had 30 months of track. And then after 18 rejections, we upped our Series D ride.”

According to media reports, the company has laid off around 1,000 employees, including permanent and contract staff.

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