According to today’s statement, the Egyptian-born, Dubai-based mobility business SWVL plans to let off 32% of its employees.
According to the company’s LinkedIn site, there are over 1,330 employees. The mobility company will lay off 400 workers, or more than 30 percent of its workforce.
In recent months, private and public tech companies have commenced a reckoning as their valuations have been beaten. Companies have had to cut costs because of the downturn in the economy. Layoffs are at the top of the list.
SWVL Layoff And The Global Trend
This layoff from the Dubai-based firm adds to the growing number of global cross-stage layoffs during a difficult month for tech workers. According to statistics, over 15,000 tech workers have lost their jobs in the United States alone. Companies like Klarna, Getir, Gorillas, and Bolt (a payments company) have fired some of their workers, while Snap, Twitter, and Instacart have stopped hiring altogether.
SWVL had a hectic 18 months before this announcement. This year, the company became public through a SPAC merger with Queen’s Gambit Growth Capital, a corporation led by women in the United States. It debuted at $10 per share and aimed for a $1.5 billion valuation but has traded primarily between $4 and $8. It is currently valued at between $500 and $600 million.
According to insiders, the layoffs occurred barely one month after SWVL acquired Zeelo, a U.K.-based mass transit company, for $100 million. SWVL has bought five companies in the past year, including door2door in Germany, Voltlines in Turkey (for $40 million), Shotl in Spain, and Viapool in Argentina.
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Even though these purchases have helped SWVL grow, the company will have to cut jobs that have been made unnecessary by investments in its engineering, product, and support functions teams.
In a statement, SWVL said that the expected layoffs would affect teams whose jobs have been automated because of investments in engineering, product, and support services.
SWVL stated that it intends to achieve profitability next year.
The dismissal of hundreds of employees is one strategy to achieve this goal. In a statement, the company said that, among other things, it is working to strengthen its proprietary technology stack and expand its three MRR-generating models into new and existing markets.
SWVL Global Reach
SWVL is available in thirteen international markets, including the United Arab Emirates, Egypt, Kenya, Germany, Spain, Italy, Switzerland, Turkey, Japan, Argentina, Saudi Arabia, Jordan, and Pakistan. A source said that most of the layoffs would happen at the company’s headquarters in Dubai and Pakistan.
It’s not clear if SWVL will follow through on its plans to expand into places like Colombia, Mexico, South Africa, and the United States.
“Swvl aims to give financial, non-financial, and job placement assistance to help affected workers transition to new roles,” the business said about how it will assist affected employees. As a result of the effort to optimise the company’s portfolio, Swvl’s management thinks that the company will start making money by 2023.
The company’s CEO, Mostafa Kandil, addressed a letter to his staff about the layoffs. Here is a portion: Swvl is starting a programme to help it focus on its most profitable operations, make them more efficient, and cut down on high costs.
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-Focuses on the most profitable activities, TaaS and SaaS, which have more than 500 contracts in more than 10 countries and bring in more than $5 million a month.
The B2C business is also anticipated to have positive contribution margins by 2022. Viapool, Volt Lines, Shotl, and the upcoming purchase of door2door are all ways to make more money.
Use a world-class engineering and product team and technologies that make growth scalable and sustainable.
Resources
No matter how vast resources are finite, money is intended to be used properly. We have to be as strict as ever, so on May 30, 2022, we said that our portfolio optimization programme would give us a positive cash flow by 2023.
As part of this program, we have examined a variety of scenarios that will allow us to illustrate the value we place on our personnel. We think that Swvl’s success is all because of the team, and we’re sure that the group will keep getting better.
What We Did
-Salary deductions volunteered by the executive team
-Decrease in current office space
-Freezing our existing recruitment programme
-Freezing travel and lodging expenditures
-Aligning spending with core business needs
To the members of staff
Today, May 30, 2022, we will streamline our operations in specific markets while reducing our staff. The reduction results from a comprehensive analysis of team redundancy and how it complements our overall strategy.
We have organized one-on-one communication with every affected teammate. Based on each market’s laws, rules, and best practices, each person on the reduced staff will be invited to talk with a senior leader about what to do next.
To those who will depart, I extend my apologies. And most importantly, you are not to blame. You will always be welcome at Swvl, and our door will always be open. We are fortunate and appreciative to have worked with such exceptional talent, which many businesses would be privileged to possess.
In addition to your job, we will remember that we recruited people who were superior to us. I am confident that you will continue to have a substantial influence wherever you go, just as you did every day at Swvl.
Transitional assistance for affected employees:
-Severance: All affected employees will get a severance based on their gross salary and total cash compensation.
-Provident Fund, Gratuity, and Leave payment cashouts and other lawful payments
-Every RSU shall be deemed vested.
-Clearance of expense claims and OPD claims
-All final settlements are subject to local taxation.
-Payout transfer must be finalized within 21 days.
Medical insurance coverage will be provided to all eligible employees.
All unvested stock options for affected workers will continue to vest as scheduled.
The Alumni Database: a directory of alumni networks to assist our impacted workforce.
No protocol regarding interviews for re-joiners. The retention of laptops by employees is subject to data security standards.