Unacademy tells employees to focus on profitability at all costs to ‘survive the winter’

Unacademy, one of the high-profile Indian startups, has urged its employees to learn how to work under constraint and focus on reaching profitability as the SoftBank and Tiger Global-backed online learning platform predicts a dry funding spell across the industry for as long as 18 months.

The Bengaluru-headquartered startup, which has raised over $800 million and was valued at $3.44 billion in its most recent financing round in August, “always raised more money than what was needed” to “continuously experiment and grow our platform without worrying about when we will run out of money,” wrote co-founder and chief executive Gaurav Munjal in an email to the staff on Wednesday.

“[…] But now we must change our ways,” he wrote in the email, contents of which were obtained and reviewed by TechCrunch.

“Winter is here.”

Munjal said he anticipates scarcity in funding for 12 to 18 months. “Some people are predicting that this might last 24 months. We must adapt. This is a test for all of us. We must learn to work under constraint. We must focus on profitability at all costs,” he wrote in the email, titled “A different Iconic Goal this time.”

“We must survive the winter,” he added.

Investors across the globe have sounded alarms in recent weeks, urging portfolio founders to plan for the “worst” amid a sharp reversal in tech stocks after a 13-year bull run. Y Combinator last week advised its startups to raise additional capital if they can to ensure they have a runway of about two years, TechCrunch first reported. Sequoia and Lightspeed have offered similar suggestions.

Scores of startups, many of which raised capital at peak 2021 valuations, are currently struggling to raise new rounds as investors increasingly become cautious and the good old due diligence makes a comeback. Several VCs who were in advanced stages of talks to back startups — across different stages — a few weeks ago are renegotiating prices.