New Delhi: Indian microblogging app Koo, seen as an alternative to X (formerly Twitter), has paused payment of salaries to all its employees citing financial constraints, the company told Inc42.
The app had grabbed eyeballs during the Indian government’s row with X, owing to the Narendra Modi government’s request to block certain accounts, with many Union ministers and Bharatiya Janata Party leaders migrating to Koo overnight in 2020.
A Koo spokesperson told Inc42, “We are in talks with strategic partners for Koo. This is taking longer than expected. In order to get the partnership through we have ploughed in substantial personal funds also to meet past salaries. Salaries will continue to be paid post the conclusion of the partnership since this partnership also includes a fresh capital infusion into Koo.”
According to the report, employees were informed of the changes on a Zoom call earlier this month. A Koo employee has alleged that their managers and HR officials have not responded to their questions after the announcement while another pointed out the lack of an official email communicating the delay in payments.
The company has also reduced its workforce by 80% since June 2022 and many employees have had their salaries slashed by up to 40%, the report said.
A slew of senior employees left earlier this year, after a significant cut in their pay. “For employees having salaries higher than INR 30K, there was a salary cut of up to 40%. This was significant for many,” an employee told Inc42.
The app, which has been accused of amplifying government propaganda and letting anti-Muslim hate speech go unchecked on its platform, is primarily targeted towards non-English speaking audiences.
Digital rights activist Nikhil Pahwa told the BBC in 2022 that there is a clear rationale for the Modi government to promote Koo as a homegrown, even “nationalist” alternative to Twitter, so that it can create a “soft landing spot” for itself, in case the need to ban Twitter arises in the future.
According to the report, the company has an operating income of merely Rs 14 Lakh and a staggering Rs 197 crore loss in FY22 with a heavy reliance on paid customer acquisition campaigns.
Despite big names like Tiger Global, Accel, 3one4 Capital, Kalaari Capital, and Blume Ventures investing in Koo, the company has not been able to land a viable revenue model.
After ceasing paid campaigns to onboard new users in June 2022, its subscribers dropped from 7.2 million to 2.7 million, the report said.
