Big Tree Entertainment, the Mumbai-based company that owns online ticketing platform BookMyShow, has announced a cost-cutting exercise that will affect nearly 19% of its workforce.
The Mumbai-based company is laying off or furloughing about 270 employees across various functions and teams out of its 1,450-strong workforce, according to a memo sent by Ashish Hemrajani, founder and CEO of BookMyShow to his employees, which is also posted on its website.
“Today, we are at the stage where I have to share with you, the uncomfortable, unfortunate yet inevitable downsizing exercise that we have to take due to the unfavourable environment,” Hemrajani wrote.
Retained employees have taken voluntary salary cuts ranging from 10% to 50% at the leadership level and have given up their bonuses. “The company has cut all other expenses and renegotiated with vendors, partners and landlords and after exhausting all other cost-saving measures, we have taken this decision as a last resort,” the post said.
Laid-off employees are offered a severance package equivalent to a minimum of two months of salary irrespective of their tenure or as per notice period, whichever is higher. It will also provide medical insurance cover for affected employees and their nominated family members until September 30th, 2020.
Furloughed employees will be eligible for all medical insurance, gratuity and other benefits as per their employment standards, it said.
The company also said it will help affected employees find new placements.
Founded in 2007, BookMyShow has operations in countries such as Indonesia, Dubai, Sri Lanka and Singapore besides its home market India. Started as an online ticketing platform for movies, the platform diversified into the management of live entertainment events including music concerts, live performances, theatre and sports.
The company was valued at $750 million during its Series D round in July 2018 led by TPG Growth. Its other investors include SAIF Partners and Accel India.
BookMyShow narrowed its losses for the financial year ended March 31, 2019, on the back of strong growth in sales during the year. The company reported a 52% growth in its consolidated revenues in FY19 to Rs 594 crore and contained its losses at Rs 115 crore against Rs 162 crore a year ago.
The company’s operational costs, which it categorizes under miscellaneous costs, saw a steep increase to Rs 344 crore from Rs 159 crore a year ago. These costs include artist fees, cost of tickets sold, payment gateway costs and stage venue costs among others.
BookMyShow joins a slew of other internet companies that have enforced such downsizing exercises. The Covid-19 pandemic and the resultant economic crisis has led to job cuts at cab aggregators Ola and Uber, food delivery firms Swiggy and Zomato, B2B ecommerce marketplace Udaan, regional language social media firm ShareChat, interior design marketplace Livspace, shared office space provider WeWork India, health and wellness startup Cure.fit, new and used cars marketplace CarDekho and online lending platform Lendingkart among others.