Gojek lays off 430 employees – 9% of total headcount

Indonesian super app Gojek has announced that it’s laying off 430 employees or about 9% of its total headcount. The layoffs are part of a “long-term response to the Covid-19 pandemic” to prioritize its core businesses of payments, transport, and food delivery, the company said in a statement.

Its GoLife division, which includes on-demand cleaning and massage services, will be closed down by July 27. The decacorn will also shutter GoFood Festivals, a physical food court concept featuring GoFood merchants.

Photo credit: *Tech in Asia* Indonesia

“Focusing on our core services, shutting down verticals that are no longer viable during this period, and making bold bets on changing customer needs will ensure that we continue making a positive impact on the lives of millions of people while securing future growth,” said Gojek co-CEOs Andre Soelistyo and Kevin Aluwi in an internal email sent to staff.

“Many” of the affected employees work for GoLife and GoFood Festivals, the company said, and this exercise will be the only Covid-19-related layoff.

Both Go-Life and GoFood Festivals saw a “significant downturn” due to the Covid-19 crisis. Its three core services aside, Gojek claims it’s seeing growth in logistics and groceries since the pandemic.

The changes were announced in a series of 16 internal town hall meetings attended by all employees. Retrenched staff will be provided with benefits such as enhanced severance payments, health insurance scheme extensions, and outplacement support.

A busy few months

Gojek has been in the headlines recently. It announced a fundraise from Silicon Valley titans Facebook and Paypal in early June, while its video-streaming service GoPlay closed its first independent funding round “in the ballpark of US$15 million.”

The news was then followed by the departure of its high-profile chief technology officer, Ajey Gore, after a five-year stint. Word about a Gojek layoff had floated earlier this year, but Soelistyo denied such news during the company’s March town hall.

Even as Covid-19 weakened the global economy, Gojek confirmed that it bought a minor stake in local taxi company Bluebird in February. The deal was reportedly worth US$30 million.

In April, Gojek also announced its acquisition of Indonesian point-of-sales startup Moka in a deal expected to be worth over US$100 million. While this was publicly announced in the middle of the pandemic, these deals could have been sealed in the months prior.

Gojek is hardly the only tech giant to be affected by Covid-19. Just last week, its archrival Grab announced that it had let go of 360 people – around 5% of its total headcount – as it prepares for a “long recovery period” post-pandemic.

Similarly, Grab will be sunsetting some non-core projects and consolidating functions. It plans to adapt the core verticals of ride-hailing, payments, and financial services to the new normal, while also doubling down on delivery to meet increased demand.

2020 has proven to be a tough year for the tech community. So far, we have reported layoffs from prominent tech startups including One Championship, Oyo, LendoEFL, Ola, Uber, Oriente, Zilingo, Hmlet, and CXA.

Gojek’s letter addressing the layoffs