Sharan Hegde's The 1% Club Lays Off 15% Of Workforce Citing AI Advancement
The 1% Club was founded two years ago by Sharan Hegde and business partner Raghav Gupta.
Finfluencer Sharan Hegde’s financial education platform, The 1% Club, has laid off approximately 15% of its workforce, with job cuts primarily affecting employees in the content, research, and marketing departments.
Founded just two years ago by Hegde and business partner Raghav Gupta, The 1% Club has rapidly grown from a small team of interns to nearly 200 employees. However, the company’s meteoric growth has also led to its first round of cost-cutting measures. As the company continues to scale, both Hegde and Gupta are emphasising the role of AI in driving operational efficiencies and reducing redundancies, Hegde said in a post on LinkedIn.
The layoffs are primarily due to the increased capabilities of AI in content creation and research, which leads to significant reductions in the need for human labour in these areas, Moneycontrol reported. AI tools like Perplexity have made research much faster, and content creation is increasingly automated, Gupta explained to MoneyControl. In many cases, job roles became redundant, and in others, performance issues contributed to the decision, he said.
In a LinkedIn post, Hegde addressed the impact of the layoffs, while providing context for the company’s cost-cutting strategy. “I started this company from my bedroom with just five interns, and today we have almost 200 employees. Needless to say, when you grow at such a lightning speed, mistakes are bound to happen, including with hiring and redundant expenses,” Hegde wrote.
The 1% Club’s profitability and operational efficiency would be boosted by these AI-driven cost reductions, he said. “This is our first cost-cutting exercise since inception. We have identified significant AI-driven cost savings that can be reinvested into the business to fuel further growth.”
Hegde also reassured the public and his team by stressing the company’s commitment to supporting laid-off employees. “We’ve offered healthy severance packages, and we continue to help them find new opportunities within our network of peer companies,” he said.
Despite the layoffs, The 1% Club remains in a strong financial position, Hegde said. Currently, the company is generating an annualised revenue of around $8 million, with an Ebitda margin of 35–40%. The 1% Club has nearly 85,000 active paying customers, and its lifetime membership plan, which costs around Rs 22,000, continues to be a popular offering. Additionally, the company has launched new financial products, some of which have already achieved profitability.
“We’ve been able to grow the company entirely with our profits without relying on external funding beyond the Rs 10 crore we raised,” Hegde said. “In fact, that investor money is sitting in an FD earning 8.5% interest, while we continue to scale and diversify our revenue streams.”
The 1% Club, which Hegde and Gupta describe as a 'socio-finance community,' offers a wide range of financial tools and services to its customers. These include a finance academy, events, a community app for accountability partners, and tools for planning financial goals or making investment decisions.
Despite the uncertainty caused by layoffs, Hegde is confident that The 1% Club will continue to thrive. "Raghav Gupta and I have been running this company bootstrapped, without ever using investor capital because we are super strict with our financial planning and diligence," he concluded.
