Bharat Pe co-founder Ashneer Grover has spoken out on the layoffs taking place across the world. The entrepreneur took to social media platform LinkedIn to share his piece of advice to the business leaders, warning them against being swayed by the massive layoffs carried out by Twitter’s new owner Elon Musk. After taking over the social media platform, the Twitter owner slashed half of the 7,500 staff including 90 per cent of staff in India.
“Don’t be swayed by what Elon Musk is selling as couture. It does not fit your body type. None of you have bought over a business with your own money, nor do you own 100%. You carry the baggage of having built your team – he doesn’t – at least not in twitter. He is doing perfectly what is needed in an acquisition – not applicable to you at all”, Grover said.
Besides Twitter, Facebook’s parent Meta cut 11,000 jobs across the world with CEO Mark Zuckerberg announcing sops for laid off employees with a ‘Sorry’ note. E-commerce platform Amazon also announced that it will carry out layoffs which will be extended to 2023.
He told entrepreneurs that business has cycles and they have to be ahead of the cycle and not get consumed by it. “We are going through a down cycle. Cutting costs is needed to extend runway. Firing people is fashionable – but actually optional”, the entrepreneur wrote.
“I have this concept of ‘real salary’ vs ‘paid salary’. In 2021, the real salary (at which markets clear) at which your employees were getting poached was higher than the salary you were paying”, Grover, who was a judge on popular reality show Shark Tank India, wrote.
“In 2022 the real salary at which people will find jobs (if at all) if you let them go is lower than salaries you are paying. So if you think you will need people back – simply reduce salary by 25% (40% in case of tech employees) rather than doing mass layoffs. It’s a better solution as rehiring will be really uphill and costly. Reinstating salary is click of a button away”, he added.
Grover advised business leaders to not take any approvals or advice from investors or ‘so-called’ boards. He said investors never handled people as they bring capital and not labour or enterprise.
Grover in a tweet explained Musk’s latest layoff move at the social media platform he acquired at a whopping $44 billion.
“First @elonmusk took over company, fired incompetent mgmt and then did layoffs in a bloated org. Most copy cat Founders are skipping the first hard part (of firing themselves or getting bought over) and conveniently copying layoffs. What works in M&A just does not otherwise!” he tweeted.