In January 2023, Relevel, a subsidiary of Unacademy, announced the layoff of 40 employees, nearly 20% of its workforce. This move marks a significant shift in the company's focus towards its test product business. In this article, we'll explore what led to these layoffs, the reasons behind them, and their potential future impact.
The layoffs at Relevel were primarily driven by a strategic shift in the company's focus towards its test product business. According to Unacademy CEO Gaurav Munjal, the decision to lay off 40 employees, nearly 20% of Relevel's workforce, was due to a lack of available roles for the affected employees. This move aligns with broader industry trends where companies are increasingly pivoting towards specialized and innovative solutions to stay competitive. The shift from Relevel's core education business to the new test product app, NextLevel, reflects changing industry demands and the need for businesses to adapt to evolving market conditions. Additionally, the restructuring within Relevel is part of a larger trend within the edtech sector, as Unacademy has laid off more than 1,500 employees across its subsidiaries over the past year. This indicates a significant realignment of resources to focus on areas with higher growth potential.
The layoffs at Relevel are expected to reduce immediate operational costs, providing short-term financial relief. Severance packages, including notice period pay and additional benefits, will incur some costs, but the overall savings from reduced payroll expenses are likely to outweigh these initial outlays. In the long term, focusing on the test product business, particularly the NextLevel app, aims to streamline operations and enhance profitability.
Strategically, Relevel is pivoting from its core education business to concentrate on the NextLevel app, which matches job seekers with global opportunities based on ratings. This shift is designed to position Relevel for future success by tapping into the competitive job matching and upskilling market, potentially offering a unique value proposition to job seekers worldwide.
Relevel's layoffs are poised to reverberate through the HR industry, underscoring the volatility within the job guarantee vertical. As companies pivot towards specialized test products and upskilling platforms, the focus shifts from traditional education models to innovative solutions like Relevel's NextLevel app. This trend highlights a growing emphasis on rating-based job matching systems, which could redefine hiring practices. Additionally, the comprehensive severance packages provided to affected employees reflect a broader industry move towards mitigating the impact of layoffs. Overall, these changes signal a significant transformation in how companies approach talent assessment and employee retention.
Relevel's layoffs stem from a strategic pivot to its test product business, aiming to cut costs and boost profitability. This shift could enhance Relevel's market position by focusing on job matching and upskilling. The broader edtech sector may see similar moves, emphasizing innovative solutions over traditional models. Future implications might include further realignments to stay competitive and meet evolving market demands.
