The tech layoffs are still coming.
Indonesian super app and ride hailing giant Gojek announced it would lay off 9% of its employees, about 430 workers in total.
The layoffs being primarily in its lifestyle division, which offered cleaning and massage services. This will surely have an impact on contractors providing services to GoLife, which numbered around 60,000 in 2019.
The company will also be closing down its lifestyle services arm, GoLife and its foodcourt, GoFood Festivals.
Go-Jek is indeed trimming the fat and closing down operations that isn’t adding to its core values.
A company spokesperson said Go-Jek is prioritising “high-impact core businesses of payments, transport and food delivery in a long-term response to the COVID-19 pandemic.”
Go-Jek is also reportedly finalizing a US$3 billion investment round at a US$10 billion valuation.
The bigger picture
Just last week, Go-Jek competitor Grab also announced that it had let go of 360 employees, about 5% of total headcount and is also trimming down to its core business units.
Following the economic downturn caused by the pandemic, consumer facing tech companies are either downsizing or going back to their company’s “core values”.
This is a good move for the industry, in our view as it allows a sort of re-set for tech startups that are generally bullish about bleeding cash after raising million dollar rounds.
Go-Jek is growing its domestic empire
Go-Jek itself is also seemingly shifting strategies; it’s going hyper-local whilst Grab is continuing to cement its regional position.
Indonesia is Go-Jek’s most important market, and without a strong foothold on the country, it has nothing.
Go-Jek launched its own streaming service, GoPlay last year and earlier this month, independently raised money for the unit. The money will be used to boost local filming production and beef up content to compete with the likes of Netflix.
GoPlay is purely a domestic play, and a sign that Go-Jek is intent on strengthening its local ecosystem of entertainment, rides, services and payment to Indonesians.