The Outbreak Of COVID-19 Is Leading To Startup Layoffs In Austin

March 5th, 2020

The novel COVID-19 has not only hit hard on health but also the economy and even the established firms are forced to go through staff layoffs. After many tech hubs market across the globe, now Austin is laying-off its startup community workforce. The layoff came just after the cancelation of the massive annual event of South By Southwest (SXSW) organizers a couple of weeks ago.

According to a report, many new startups have emerged in the past 3 years in Austin, Moreover, along with the rise of new unicorns, these startups have got substantial investments from investors.

Recently, an Irvine-based restaurant software development startup Restaurant365 also laid off its sales team and other staff from its Austin office. Restaurant365’s MD Patti-Lynn Walker sent an internal email to its employees, confirming that the company has limited its headcount by laying off its workforce without mentioning the exact number. The COVID-19 has hit hard on the restaurant businesses and the world’s economy. Walker also wrote that the affected employees would get a live video conference by Restaurant365’s HR team.

The Outbreak Of COVID-19 Is Leading To Startup Layoffs In Austin

According to Austin’s digital media firm, Austin Inno’s reporter Brent Winstrom, not only Restaurant365 but more startups that have also received VC funds in the past 8 months, has cut down its workforce. 

Austin-based marketing software startup OutboundEngine’s CEO Marc Pickren said that he has reduced the firm’s headcount to 135 after eliminating 52 employees, including the reduction of 30% of its leadership team. Marc explained that COVID-19 is the reason behind the layoffs as it has impacted the financial markets.

According to The Information cited article, the Austin-based hospitality startup, The Guild, which recently bagged $25 million in its Series B round, has also laid off 38 employees, reducing the headcount to 132. Yonder, another Austin’s AI-powered startup that helps firms to understand the cultural context behind online information, has also removed 18 of its workforce. 

Alongside this, a famous publishing firm has also reported several such travel and hospitality startups that have laid off their eminent employees in recent times.

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