Chennai-based Software-as-a-Service (SaaS) firm Kissflow has laid off approximately 45-50 employees, accounting for 15% of its staff, due to product shutdowns and annual performance reviews. The layoffs affected employees across various functions, including sales, marketing, and product development.
Kissflow founder and CEO, Suresh Sambandam, confirmed to Moneycontrol, “We let go of around 20-25 people as we transitioned from a land-motion procurement strategy to an expand motion to increase customer acquisition across our products. Additionally, during our regular performance reviews, which occur every two to three years, around 20 employees were let go.”
Before the layoffs, Kissflow had over 400 employees on its payroll. The layoffs impacted employees in India, the US, and the UAE, although the numbers were fewer than five in the US and UAE.
Founded in 2012, Kissflow offers cloud-based no-code and low-code work management products. According to its website, Kissflow’s products are used by over 10,000 customers across 160 countries, with offices located in Chennai, the US, and Dubai.
The layoffs follow two years after the firm recognized its five senior executives with brand new BMW 5 Series cars worth Rs 1 crore each, celebrating their long association with the company.
“Every company is looking to optimize, and 90% of the people who were laid off are already placed in new companies, with the remaining 10% expected to be placed soon,” Sambandam noted. He also mentioned that severance was provided to the employees who were let go.
Kissflow remains a bootstrapped company, having not raised external funding to date. However, Sambandam stated, “The valuations have not bounced back, and we are not in a hurry to raise funds. If the market turns suitable and valuations correct, we will evaluate raising funds.”
The layoffs come at a time when SaaS firms worldwide are experiencing a slowdown due to macroeconomic conditions. The sector is also facing pressures from advancements in artificial intelligence. Last year, Nasdaq-listed SaaS firm Freshworks conducted multiple rounds of layoffs in its product, engineering, and go-to-market teams in the US, citing performance reviews.
Several investors are urging SaaS startups to integrate artificial intelligence, particularly generative AI, into their operations to avoid obsolescence and enhance their ability to raise funds in 2024. According to a report by SaaS accelerator Upekkha, Series A investments (around $5 million) are expected to see a significant dip, with increased stringency in metrics. Large language models (LLMs) are poised to have a substantial impact on the industry, akin to the influence of mobile operating systems in 2009.
With the strategic shift and focus on optimizing operations, Kissflow is navigating the challenging landscape while aiming to enhance its market presence and customer acquisition efforts.
