Kenko Health, a healthcare financing startup, has joined 2023’s list of startups laying off employees.
According to recent reports, it has laid off nearly 20% of its employees. The exact number of employees impacted by the layoff isn’t clear yet. While Entrackr reported 50-60 employees are impacted, Inc42 reports the number to be around 80.
Kenko Health Layoff details
Kenko Health had around 400 employees before the layoff. Inc42 reported that employees from support, sales, processing and tech teams in Kenko’s Delhi and Bangalore offices are impacted by the layoff.
Some sources indicate the layoff percentage can be as high as 50% of the employees. However, there has been no response to queries from the Kenko team.
Why did Kenko lay off employees?
Inc42 sources cite the ongoing funding crunch and the startup’s inability to generate consistent revenue as the reasons behind the layoff.
They also state several employees were put on performance improvement plans and consequently fired without any warning.
About Kenko Health
Kenko Health is a Bangalore-based healthtech startup founded by Aniruddha Sen and Dhiraj Goel in 2019. The startup provides healthcare financing to cover OPD expenses, including medicines, lab tests, consultation fees and other OPD hospital bills. It does so by offering monthly subscription plans.
The plans start at INR 175 per month and go up to INR 950 per month. Everyone, including individuals, corporates, startups and small businesses, can avail of Kenko’s plans. The startup claims to have over 3 lakh subscribers and tie-ups with 200+ corporations.
While there are innumerable health insurance providers, very few cover OPD expenses, which are the largest out-of-pocket health expenses for any individual. Kenko Health is one such startup.
Kenko’s current conditions
Kenko had raised $12 million in its Series A round last year. The funding was led by Peak XV Partners (formerly renowned as Sequoia Capital India) and saw participation from 9Unicorns, Beenext, Orios Ventures and Waveform.
The startup used this funding to bring in more talent, strengthen its product and acquire new customers. Kenko’s LinkedIn data shows an increase of 31% in hiring since last year.
Last month, Kenko announced its collaboration with Tata 1mg to extend its reach and make quality healthcare accessible to a wider audience. Through this strategic collaboration, the startup will be able to leverage Tata 1mg’s vast supply chain that covers over 20000 postal codes.
Reports also highlight that Kenko was actively trying to raise its Series B funding this year. However, the current markets and ongoing funding winter have made it difficult.
Bottomline
Kenko Health has seen rapid growth since its funding last year. It has also made collaborations with bigger players like Tata 1 mg. However, being unable to raise subsequent funds this year, burnout of raised funds and inadequate revenue generation have pushed it to lay off employees.
Several healthtech startups and companies have sought employee layoffs to survive after going on a hiring spree post-funding the previous year. The names include renowned players like Practo and Mojocare.
Not just India, global digital health funding is low by 49%, which is the worst since Q4 2019. And healthcare companies across the globe have been laying off employees since 2022.
Though the digital health market holds promising potential, current conditions have turned out challenging for every individual out there.
