After recording a landmark revenue of $50 million, tech firm and talent accelerator, Andela, has announced that it will lay off over 250 junior engineers across Kenya, Uganda, and Nigeria.
Jeremy Johnson, Chief Executive Officer and Co-Founder of Andela, made this known Tuesday in a statement titled “The Future of Andela”.
The layoffs come as the company announced its plan to hire another 700 experienced engineers by the end of 2020 in order to keep up with demand from its partners.
To continue creating junior engineering talent at scale, it also said it will invest in the Andela Learning Community, through which it has already trained more than 30,000 learners in software engineering fundamentals.
….and it's a wrappppp!!!
Thank you to everyone who showed up today; the learners, the facilitator and mentors.
Big shout out to @PlusinnovationH for hosting us. 🙌🏽#150DaysOfALC4 #ALCWithGoogle #GrowWithGoogle pic.twitter.com/byTcgjbjMy
— Andela Learning Community (@andela_alc) August 3, 2019
But despite the huge plan, the company said it has seen shifts in the market and what its customers are looking for in more experienced engineers.
By implication, Andela is letting go over 250 of its contracted junior developers in Lagos and Uganda while up to 170 trainees in Kenya could also be potentially impacted, the company said.
“As a result of that,” the statement said Tuesday, “we began sourcing and assessing mid-level and senior engineers, and they now represent more than 25% of our talent base.
“While placing teams led by senior engineers has helped drive additional junior placement, it hasn’t been enough. We now have significantly more junior talent than we are able to place.
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We had an amazing time hosting the CEO of @github, @natfriedman and his team at our Andela Nigeria office today. Nat visited us to learn more about Andela, what we do and to get feedback from our software engineers on their experience with GitHub. Nat also spoke to the engineers about Open Source and how important it is for solving some of the world's biggest problems. #ThisIsAndela #GitHubVisitsAndela #Tech #GitHub
The departing Andela software-engineers will gain severance packages and placement assistance, according to Johnson. The company is working with partners such as CcHub and iHub to connect the developers to new opportunities.
“Many of these people will rapidly get jobs in the local ecosystem and someday may come back and work at Andela again,” he said.
On Andela’s $50 million in 2019 projected income, “It’s the first time we’ve ever confirmed anything on revenue,” said Johnson ― who acknowledged the venture is still not profitable.
He wouldn’t say why the company released those figures now, but one can speculate it is to soften concerns about Andela’s financial performance in light of major staff cuts.
Johnson flagged the revenue significance in a global startup context. “What it means is the world needs what we do. Very few companies have gotten to a $50 million run rate in under five years.”