Egypt-born and Dubai-headquartered mobility startup SWVL is planning to lay off 32% of its workforce, it said in a statement today.
The company’s LinkedIn profile shows it has over 1,330 employees. Letting go of over 30% of its workforce means that around 400 people will lose their job at the mobility company.
Tech companies, private and public, have faced a reckoning in the past few months with their valuations taking a beating. The effect of an economic downturn has also affected their finances leading them to cut costs; top of the list is letting go of employees.
This downsizing from the Dubai-based startup adds to the long list of global cross-stage layoffs in what has been a rough month for tech employees. Over 15,000 tech workers have lost their jobs in the U.S. alone according to reports. Companies such as Klarna, Getir, Gorillas and Bolt have dismissed portions of their workforce while the likes of Snap, Twitter and Instacart have slowed down hiring entirely.
It’s been a very busy 18 months for SWVL. This March, the company went public via a SPAC merger with U.S. women-led blank check company Queen’s Gambit Growth Capital. It listed at $10 per share and targeted a $1.5 billion valuation but has traded between $4 and $8 for most part. Its current valuation hovers around $500-600 million.
This layoffs news is coming just a month after it acquired U.K.-based mass transit group Zeelo for $100 million according to sources. It’s one of five acquisitions SWVL has made within the past year; others include Germany’s door2door, Turkey’s Voltlines (for $40 million), Spain’s Shotl and Argentina’s Viapool.
SWVL said that though these acquisitions have contributed to its overall growth, it will need to made reductions on roles automated by investments in the its engineering and product and support functions teams.
“The planned layoffs will impact teams responsible for functions that have been automated following investment in engineering, product and support functions,” SWVL said in a statement.
SWVL said it plans to attain profitability next year. Dismissing hundreds of employees is one way to get there. Others include developing its proprietary technology stack and growing its three models — where it makes $5 million in MRR — across existing and new markets, it said in a statement.
SWVL is present in 13 markets globally: the UAE, Egypt, Kenya, Germany, Spain, Italy, Switzerland, Turkey, Japan, Argentina, Saudi Arabia, Jordan, and Pakistan. According to a source, majority of the layoffs will come from the company’s Dubai and Pakistan offices.
“Swvl plans to provide monetary, non-monetary and job placement support to help transition certain of its employees to new roles. As a result of the portfolio optimization program, Swvl’s management currently expects that the company will be cash-flow positive in 2023,” it said in a statement.