The travel industry has been in a soup since the coronavirus outbreak. With many countries closing their borders and visas getting rejected, the travel and tourism industry is getting severe blows. Start-ups, in travel aggregation and vacation planning, have seen their business almost coming to a complete halt in the last two months, and for some that were already making losses, it may be difficult to sustain their headcount with the most recent impact.
One such struggling boat appears to be a nine-year-old startup, TravelTriangle. The company enables customers to connect with local travel agents for their personalized holiday plans. It is learned from anonymous sources close to the company, that this week the company has handed over pink slips to more than 100 employees at various levels. The firings are expected to continue for some time and may impact over 10 – 15 % of its total workforce. The move may be an outcome of piling up losses further fuelled by the complete halt on business and vacation travel considering the coronavirus pandemic.
An employee, requesting anonymity, said, “The maximum number of layoffs have been made from international destination teams. Due to the virus, travelers have been canceling on scheduled trips since January, which led to severe losses for the company.”
The layoffs are not just limited to the international division, it is also being said that the flight booking team and domestic team employees are also being given pink slips. Apart from firing employees, the company has also asked some employees to take unpaid leave for the next few months.
Another source on the condition of anonymity said that there have been layoffs in the senior management team as well. Apart from layoffs, there are reports of several higher-ranking employees being asked to take significant salary cuts to help the company tide over the present crisis and ensure business continuity.
Earlier there have been reports and complaints on social media related to delay by the company in processing refunds to the travelers, and handing cancellations appropriately. In some cases, there have been delays in issuing refunds, even when the travelers had canceled their trips well in advance.
Although there has been no official confirmation on the matter of firings by the company, HrNxt News Desk, has requested confirmation from the company in this regard.
TravelTriangle has been reporting losses for quite some time now. In FY 2018, the company reported a loss of ₹39.84Cr, a 6.41 percent increase from ₹37.44Cr in FY 2017. According to RoC filings with the Ministry of Corporate Affairs, the expenses for the financial year ending March 2018 stood at Rs 62.31 crore, a 21 percent spike as compared to Rs 51.5 crore figure at the end of the previous financial year. Most recently, the company had raised Series D funding in November 2019, to the tune of $13mn from Bengaluru-based VC firm Fundamentum and KB Global Platform Fund. It appears that with the job cuts the company is trying to hold on its burn rate till the time the business appears to be back on track, which is hard to estimate based on the present outlook considering the coronavirus scare.
As per a recent release by The World Travel and Tourism Council (WTTC), up to 50 million jobs, representing a reduction of 12-14 % of the workforce employed by the sector, are at risk globally because of the pandemic and the travel sector could shrink up to up to 25% in 2020. As per WTTC chief executive Gloria Guevara, the outbreak “presents a significant threat to the industry”. In another release Global Business Travel Association (GBTA) estimates that the global business travel industry on its own is heading for a hit of up to $820 billion, the estimate has risen above the earlier estimates of $ 560 billion presented last month by the industry body.
TravelTriangle was founded in 2011 by trio Prabhat Gupta, Sanchit Garg, and Sankalp Agarwal. They have created a marketplace where travelers can interact with local travel agents empowering local travel agents to come online and compete with bigger players. So far the company has raised $47.9mn in investment spread across seven funding rounds.
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