According to MENA Bytes, Dubai-based ride-hailing service, Careem has laid off over 150 employees.
Careem’s co-founder and CEO, Mudassir Sheikha, said in an interview that cuts are being made to support its expansion strategy. The layoffs come just three weeks after Uber completed $3.1 billion acquisition of Careem.
Sheikha confirmed that, “The expansion will require cost-cutting that will involve the loss of 5% of existing roles and the reassigning of 10% of staff to more critical technology development areas”.
He further said that the decision was a hard one but it was for the greater good of the company.
There are real people involved so these are never light decisions or easy things to undertake We cannot just keep raising money and keep hiring people to make this thing happen. We have to operate in a slightly more efficient way.
He also announced the move on Twitter:
No words can express the deep gratitude that we feel towards these colleagues. They believed in us, they fought with us from the trenches, they inspired us. I know they will play a meaningful role in the next few unicorns of the region. Hire or partner with them if you can! 2/2
— Mudassir Sheikha (@MudassirSheikha) January 24, 2020
Careem’s CEO didn’t announce the exact number of people fired from their jobs, however, reports claim the number to be over 150.
The cuts being made will be in support services such as finance, branding and human resources, predominantly at its head office in Dubai.
Careem has also been witnessing an increase in the number of senior executives leaving the company for the last few months with Careem’s CFO also leaving the company earlier in January. Earlier this week, the company also announced it’s exit from Oman and Turkey.
Sheikha explained the reason behind the move, saying:
There is a lot more focus on profitability. Our efforts to make this vision come to life are going to be a lot more organic. There will be parts of Careem that will grow and there will be parts of Careem that will shrink.
Uber, that now owns Careem, has also laid off over 1,000 people from its teams across the world to cut its losses; it lost $1.1 billion in the third quarter of 2019 alone.
Via The National