Lending and bookkeeping platform Khatabook laid-off over 40 employees: Report

Khatabook, a lending and bookkeeping platform, has joined the ranks of other growth-stage businesses that have cut staff in an effort to reduce costs and increase the runway. Three sources with knowledge of the matter claim that the company has terminated the employment of over 40 people across departments.

“Khatabook has laid off 42 employees across sales, marketing and analytics, and technology verticals,” said one of the sources requesting anonymity. “People who lost their jobs in the exercise have been given standard severance packages including 3 months salary among others.”

According to sources, the company informed staff members about job losses during a town hall meeting at the beginning of this week.

According to Khatabook, who confirmed the development, it was a result of restructuring. We are reorienting some aspects of our business “In line with our profitability goals, we are reorienting some parts of our business which requires us to operate with a leaner team on certain business lines. This restructuring has impacted 6% of our 700 employees,” said a company spokesperson in a statement.

To date, Khatabook has raised $187 million, including $100 million in its Series C round, primarily from Tribe Capital and Moore Strategic. Additionally, it has Better Capital, PeakXV, and B Capital as backers.

Khatabook had shut down its e-commerce enablement product MyStore in November 2021 in order to concentrate on its core business bookkeeping and lending.

The company wasn’t making any money until FY20, but it was able to generate Rs 17 crore in revenue in FY21, which then increased to Rs 71 crore in FY22. For the previous fiscal year, the company has not yet submitted its financials. The co-founder and CEO of the company, Ravish Naresh, stated in October 2022 that the goal is to reach a loan book size of Rs 1,000 crore by October 2023. He predicted that the company would start to make money in the middle of 2024.

OKCredit, the main competitor of Khatabook, is struggling and currently runs with a small team and little overhead. Although the Lightspeed-backed company raised nearly $90 million, it was unable to scale and raise additional funding. Exactly four years ago, it raised $67 million in a Series B round. Additionally, OkCredit let go 35% of its staff in February of last year.