Indian Startup Layoffs Plunge 52 % as Funding Stabilises in Early 2025

Creative image Indian Startup Layoffs Plunge 52 % as Funding Stabilises in Early 2025
3 min read

After two bruising years of layoffs, India’s startup job market is finally showing signs of recovery. Fresh data from tracker layoffs.fyi, reveal that only 1,602 employees lost their jobs at Indian startups so far this year, spread across seven companies. During the same period in 2024, 20 startups had pink-slipped 3,355 workers.

The largest reduction this year came from Ola Electric Mobility, which trimmed about 1,000 staff and contractors in a two-month restructuring. Gupshup and Cars24 each cut roughly 200 roles, while Pocket FM, intent on boosting profitability, let go of 75 employees. Social-media player ShareChat shed 27 positions as part of its annual appraisal cycle.

Behind the calmer jobs landscape is a subtle but important shift in capital flows. Indian tech startups attracted US $2.5 billion in Q1 2025, up 13 % over the previous quarter and 8.7 % year-on-year, according to Tracxn. The funding uptick, though modest compared with the 2021 boom, has restored enough confidence for founders to pause mass layoffs and focus on disciplined hiring tied to revenue milestones.

Context matters: 44 Indian startups collectively cut more than 9,000 jobs in 2024, as a chilled funding climate forced companies such as Byju’s, Paytm, Flipkart and Swiggy to prioritise profitability over scale. Many founders front-loaded austerity during that period, slimming their cost bases and reducing the need for further deep cuts this year.

The slowdown is mirrored globally. TechCrunch data show that tech firms worldwide have laid off just over 22,000 workers year-to-date, a fraction of the 150,000 jobs lost in 2024.

Why the pain has eased

  • Front-loaded restructuring: Most large Indian startups executed their deepest cuts in 2023–24, leaving fewer redundant roles today.
  • Funding thaw: Fresh capital—especially for AI and climate-tech—has eased existential pressure on early-stage ventures.
  • Unit-economics discipline: Boards now tie new head-count approvals directly to revenue visibility, curbing over-hiring.

Storm clouds still worth watching

  • Late-stage startups seeking mega-rounds (> US $100 million) may yet face head-count freezes if capital remains scarce.
  • IPO markets remain largely shut, limiting liquidity options for scale-ups with cash-burn.
  • A sharp slowdown in the US or EU could still dent revenue for India’s cross-border SaaS players, potentially reviving layoff risk.

Outlook
Hiring is expected to remain measured through the rest of 2025, but today’s numbers suggest the worst of India’s startup layoff cycle is over—barring a fresh funding shock. For founders and employees alike, the message is clear: the era of grow-at-all-costs is over, but so too, it seems, is the era of weekly pink slips.