VerSe Innovation Lays Off 350 Employees, Shifts Focus to AI Investments

Dailyhunt parent VerSe to lay off 350 employees this month in push for profitability

Dailyhunt parent VerSe Innovation is laying off 350 employees this month as it plans to accelerate investments in artificial intelligence (AI) and streamline operations, it said on Saturday. As part of this strategic transformation, the company will use AI to automate several manual processes to "increase operational efficiency", according to a press statement. The Bengaluru-based company is taking these steps to achieve profitability by the end of this financial year. With these layoffs, VerSe Innovation joins other content-led startups that have reduced their headcount this year. This includes Google-backed vernacular media platform ShareChat, which laid off 5% of its workforce in January, and Lightspeed-backed Pocket FM that let go of 75 employees amid a push for profitability. "VerSe Innovation has been undergoing a strategic transformation to build a more agile, focussed, and future-ready organisation...To build a more future-ready organisation where talent is cross-leveraged across business units and resources are directed towards growth segments, the company will streamline its workforce by approximately 350 roles this month," it said. "Building on this momentum, VerSe Innovation projects over 75% revenue growth in FY25, outpacing the anticipated 10-15% growth rate of the Indian digital advertising sector," the company said. "Operational and structural efficiencies and a focus on growth drivers are actions directed to make the company profitable by the end of this fiscal year." The development was first reported by digital publication Entrackr. The current layoffs come two and a half years after the company had to let go of 150 employees as a cost-cutting measure. In the financial year 2024, VerSe Innovation's operating revenue stood at Rs 1,029 crore, down 6.7% from Rs 1,104 crore in FY23. The net loss for FY24 dropped 54% to Rs 889 crore. Last month, VerSe Innovation's auditor had flagged certain internal control weaknesses during the company's audit report for fiscal 2024. In its audit report, Deloitte also said that these material weaknesses did not impact its opinion on the consolidated financials. VerSe is backed by Canada Pension Plan Investment Board (CPPIB), Ontario Teachers' Pension Fund, James Murdoch's private investment firm Lupa Systems, and Z47 (formerly Matrix Partners) and has raised over $2 billion in funding since its inception. It had last raised $805 million in a funding round led by CPPIB, valuing the company at $5 billion. In addition to the news aggregator platform Dailyhunt, Verse Innovation also runs the short video app Josh, which was launched in 2020 after the central government banned Chinese social media company TikTok's operations in India.

Josh, DailyHunt Parent VerSe Innovation Lays Off 350 Employees

This comes close on the heels of auditor Deloitte flagging weaknesses in VerSe's internal financial controls in its audit report for FY24 VerSe Innovation, the parent of DailyHunt and Josh, has laid off nearly 350 employees as part of a broader "strategic" restructuring exercise. In a statement, a company spokesperson attributed the layoffs to "workforce realignment" to accelerate investments in AI, streamline operations, and focus on long-term priorities and growth. "To build a more future ready organisation where talent is cross leveraged across business units and resources are directed towards growth segments, the company will streamline its workforce by approximately 350 roles this month," the spokesperson added. VerSe said it will now focus on automating several "manual processes" to increase operational efficiency and building a "more future ready organisation". "VerSe Innovation has been undergoing a strategic transformation to build a more agile, focused, and future-ready organisation. This strategic transformation, is a part of a well thought through comprehensive plan and is geared at accelerating investments in AI, streamlining operations, and taking concerted actions to align the company's strategy and structure to its long-term priorities and growth," the spokesperson said. Going forward, the unicorn has also set its eyes on growing its revenue both "organically" and through strategic acquisitions, with plans for a future listing on the bourses. "Operational and structural efficiencies and a focus on growth drivers, are actions directed to make the company profitability by end of this fiscal year," the spokesperson added. The Many Troubles Of VerSe Innovation VerSe claimed that it reduced its EBITDA burn by 51% to INR 710 Cr in FY24 from INR 1,448 Cr in FY23 via reductions in service and marketing expenses. It added that FY24 total revenue stood at INR 1,261 Cr. However, VerSe's FY24 financials have been a source of contention for the company. Last month, Inc42 reported that auditor Deloitte flagged weaknesses in the Josh parent's internal financial controls, including issues with supplier selection, expense provision, revenue recognition, handling of virtual assets, and IT systems control, in its audit report for FY24. However, VerSe cofounder and CEO Umang Bedi told Inc42 that the financials were true and fair with a clean report, while conceding that controls within the company were weak. Notwithstanding this, VerSe projects over 75% YoY growth in revenues in FY25 on the back of investments in AI-led platforms, such as adtech platform NexVerse.ai, subscription service Magzter, among others. Overall, VerSe's net loss narrowed more than 56% to INR 814.8 Cr in FY24 from INR 1,878.4 Cr in the year ago period. Meanwhile, the company's operating revenue also declined 8.8% to INR 954.7 Cr in the fiscal under review from INR 1,046.8 Cr in FY23. Notably, this is not the first time that VerSe Innovation has laid off employees. In November 2022, the company fired around 150 employees, just months after raising a mega $805 Mn round. Last year, too, it let go of 50-70 employees as challenges with monetisation continued to pile up. With this, VerSe has joined a growing list of startups that have undertaken retrenchments in recent months. In April, used car marketplace Cars24 laid off around 200 employees across various departments as part of a restructuring exercise. Last month, Inc42 exclusively reported that insurance-focussed SaaS startup Zopper fired around 100 employees since the start of 2025. Conversational AI unicorn Gupshup also axed 200 jobs in a restructuring exercise last month.