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Loco is one of India's top streaming platforms and has managed to attract a lot of traffic since its launch in November 2017. However, recent reports suggested that the company had laid off about 40 people as part of its restructuring plan.
Loco confirmed that its workforce has been trimmed down because of a recent strategic review that shifts their focus towards a transaction based monetization model, forcing them to operate with a leaner cost structure.
Sharing additional information about the newly introduced Loco VIP Programme, the platform has managed to achieve more than 100,000 permanent users in under 60 days of the service being launched.
Loco Claims to Enroll More Than 100,000 Users in VIP Program
Loco is the latest company from the gaming and esports sector to join the list of Indian startups that have undergone a reduction in their workforce. It is down by about 40 employees from its total headcount of 110 employees, which is around a 36% cut.
Talking about the situation, both founders Anirudh and Ashwin said, "It has been a tough decision to part ways with some of our talented team members and friends. As part of a recent strategic review, we have decided to focus on transaction-based monetization and operate with a leaner cost structure. This decision has been taken to ensure the long-term health and sustainability of our company, but it comes with a heavy heart. We deeply care about the people leaving us and will provide them with financial support, ongoing health insurance, and outplacement services. The reorganization will impact approximately 40 people from our team, and we remain grateful to them for their contribution towards Loco’s incredible journey."
Expanding upon their transaction-based monetization model which is what Loco is going to focus on moving forward, it was revealed that the VIP Programme has already hit more than 100,000 permanent users in under 60 days since launch.
They claim that this number is about 3% of its total monthly active users, which is higher than the global standards for such platforms.
The recently held Skyesports Championship 5.0 which charged online viewers a one-time fee of ₹20 INR was a part of the Loco VIP Programme, making it the first such instance in the history of Indian esports.
Explaining why Loco opted to go with their latest strategic review, the founders shared the following observation, "We observed that transaction-based monetization was scaling far better than the ad-based monetization on our platform. This drove our decision to focus only on that part of the product going forward."
However, In order to be cost efficient with this business model and to ensure the long term sustainability of the company, the company had to undergo a restructuring to rationalize the roles in the organization that did not cater to these new business objectives.
This included non-revenue generating engagement initiatives and team members in other support teams like marketing, technology, finance, and operations that were supporting these initiatives.
"The reorganization was not based on employee performance at all and was driven by the new organizational structure created to support the new direction of the company," marked the concluding statement by Anirudh and Ashwin.
The Loco VIP Programme is a new initiative by the live streaming platform which includes features like ad-free viewing, access to VIP leaderboard, gifts for high ranks on the VIP Leaderboard, VIP chat badge, special username color, stand out with VIP stickers, and more.
Just last year, Loco had raised $42 million which is roughly INR 330 crore as part of its Series A funding round, led by South Korea-based venture fund Hashed, among other investors like Krafton and Lumikai.
