Here’s how GajiGesa reduced costs by 15%

Cost Control is a series where we talk to founders to suss out cost optimization methods beyond layoffs or salary cuts.

The harsh funding winter has driven many tech companies to rethink their business plans. Many startups looking to extend their runway have resorted to mass layoffs and salary cuts.

This may be a quick fix to reduce one of the largest expenses for a business. However, not only is this the most painful solution, but it is also potentially damaging, and even expensive.

Some founders are looking at other ways to slash costs and improve efficiency.

Vidit Agrawal / Photo credit: GajiGesa

Vidit Agrawal, co-founder of Indonesia-based GajiGesa, tells Tech in Asia that the earned-wage access startup has decreased its costs by about 15%, without conducting any salary deductions or layoffs.

Sunshine behind my cloud ⛅

According to Agrawal, GajiGesa has reduced close to 75% of its engineering spends – the second-largest cost item on its balance sheet after salary expenses. Its engineering team has built a relationship with Amazon Web Services and got free credits.

Besides this, Agrawal says the team looked at building efficiency in the firm’s cloud system by shortening the uptime in cloud services – the percentage of time that systems are operational – during non-peak hours like midnight, when the transactions are low. Instead of banking on fixed packages, a lot of cloud service providers charge companies by their usage of the services.

Switch to auto mode 🦾

“When I was chatting with the engineering head, he also thought about automation by bringing in a lot of ‘no code, low code’ tools,” says Agrawal.

One example is Retool, which GajiGesa’s engineering head used to create a mock-up tool. “When you’re testing a product and want to pitch it to a customer, you don’t want to spend about two sprints – which is about 30 days – building that product even before we get market research data,” Agrawal observes.

Nowadays, GajiGesa can build a mock-up or minimum viable product in about four or five hours before pitching it to customers and get feedback faster. Agrawal pointed out that using no-code, low code tools have resulted in significant cost efficiency.

Restructuring rather letting go 👷🛠️

The co-founder explains that when it came to salary expenses, which is the largest cost for many businesses, GajiGesa went for “restructuring the team, rather than letting go” of employees. He says this has helped keep salary costs flat for about 11 months.

“When you look at our EBITDA – obviously we are not profit generating right now – but our burn is steadily going down, at least on the salaries expense because it remains flat,” he notes.

The key is revenue growth 🔑

Slashing salaries vs. cutting jobs? ✂️

Eyes on the prize 💰👀