Bisnis.comJAKARTA – Economic conditions are expected to become increasingly difficult as high global inflation may affect startups that are compact in laying off employees.

Sapphire Ventures analyst Cathy Gao said tough times were ahead and it was unpredictable how long they would last.

“We are going to face tough times ahead, I don’t know if it’s just one quarter, two quarters or more,” Gao told reporters. Bloombergquoted on Saturday (07/02/2022).

He advised investors to look within and be prepared for what might happen in the future.

The reason for this is that startups that receive a second round of funding after those preparing for an initial public offering (IPO) will be heavily affected by the current economic blow.

Startups must assess, following the S&P 500 index which recorded its worst decline in 52 years due to high inflation and fears of a recession.

Shadow Ventures Founder and Managing Partner KP Reddy explained that startups are prone to turbulence that sometimes results in employees going unpaid.

“Employees are able to ride the waves or be hit by the waves,” Reddy said. Start-up squealquoted on Saturday (07/02/2022).

For information, startups in various countries are carrying out massive layoffs of their employees due to the ongoing economic instability.

Business Standard says startups in India will lay off at least 60,000 employees by the end of this year.

Meanwhile, startup Qumulo in Seattle, US, has laid off at least 19% of its employees, or about 80 people, according to GeekWire.

On the other hand, even though it has now become a giant corporation, Tesla Inc, which started its career as a startup, is also working on downsizing. At least 200 Tesla employees were laid off this week.

Streaming technology companies Spotify and Netflix have also cut their workforces, ranging from limiting hiring to laying off at least hundreds of employees.

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