SINGAPORE startup Circles.Life - hailed as the disruptor to watch in the local telco scene - is now in the midst of cutting staff.
The Business Times (BT) understands that the telco, with some 500 employees across its Singapore, Taiwan and Australia offices, had been carrying out the downsizing since November last year. A source told BT the exercise picked up pace in the last two days with the axe falling on a substantial number of staff. BT understands no department was spared.
A Circles.Life representative confirmed the layoffs to BT, but said less than 5 per cent of its global headcount has been axed so far. "This is nothing out of the ordinary, given the fast-paced nature of the organisation. There are bound to be some changes along the way as we expand.
"We are a performance-based company, so usually the bottom 10 per cent would have to go," said Rohan Talwar, Circles.Life head of corporate development.
But sources close to the matter told BT the cuts are far deeper than reported, especially in the firm's Taiwan and Australia markets.
Varun Mittal, EY emerging markets fintech leader, told BT that this is "a sign of a maturing business".
"Launch and sustainable unit economics are different. In the set-up and scale phase, you need people. But in any (mature) utility business, a customer is almost on autopilot and needs human interaction only as an exception, not a norm," said Mr Mittal.
News of the retrenchment comes just two weeks after Circles.Life secured funding in an equity round from global private equity firm Warburg Pincus, to further fund growth and for expansion in new markets.
While the startup did not divulge the investment sum, injections from growth investor Warburg Pincus are typically substantial.
Sequoia Capital India and Singapore's Economic Development Board investment arm EDBI are some of Circles.Life's earlier investors. The firm's latest undisclosed funding round was announced just eight months earlier in June.
Since its inception in 2016, the mobile virtual network operator (MVNO) has grown its subscriber base to capture more than 5 per cent of the Singapore telco market, with a compounded annualised growth rate of over 200 per cent, according to earlier reports by BT. An MVNO does not own a wireless network infrastructure but gets bulk access to network services at wholesale rates, then sets retail prices independently.
Circles.Life expanded to its first overseas market in Taiwan last June, and to Australia two months later in August.