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MPL To Lay Off 350 Employees Due To The Government's 28% GST Decision Gaming
Amarylisa Gonsalves
Posted on 08 Aug, 2023
By Amarylisa Gonsalves
On 08 Aug, 2023
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By Amarylisa Gonsalves
On 08 Aug, 2023
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MPL To Lay Off 350 Employees Due To The Government’s 28% GST Decision


In a shocking news, one of India’s biggest gaming companies, Mobile Premier League (MPL), has announced that it will be laying off as many as 350 employees, citing the latest imposition of 28% GST on online gaming as the reason for the bold step.

This will be the second round of layoffs at MPL in a span of a little over a year. Last year in May, the company let go of over 100 people following an exit from the Indonesian market. MPL was started in 2018 by Sai Srinivas and Shubh Malhotra. Today the platform offers over 60 games across several categories, such as daily fantasy sports, poker, rummy, quizzing, board games, puzzle, and other casual games. The platform has an Android app as well as an iOS app. Reportedly, the platform has over 90 million registered users across the Asian, European, and North American continenets.

After the company raised $150 million in September last year, it was reportedly valued at $2.3 billion, thus marking its entry into the unicorn club. As per reports, this move is going to impact almost 50% of the company’s workforce in India. The most affecting section of the company will be the product team which will face more than 60 job cuts. 

The founders conveyed their decision to their employees through an internal email.

The full email from MPL Founders read:

Dear Leaguers,

Last month has been extremely challenging and uncertain for all of us. We want to thank each and every one of you for the strength and courage you have shown. Last week, it was confirmed that a 28% GST will be levied on the full deposit value rather than on Gross Gaming Revenue. The new rules will increase our tax burden by as much as 350- 400%. As a business, one can prepare for a 50% or even a 100% increase, but adjusting to a sudden increase of this magnitude means we need to make some very tough decisions.
 
As a digital company, our variable costs predominantly involve people, server and office infrastructure. Therefore, we must take steps to bring these expenses down in order to survive and to ensure that the business remains viable. We have already initiated work on revisiting our server and office infrastructure costs.
 
However, despite this, we will still have to reduce our people related costs. Regrettably, we will have to let go of around 350 of you. This has been a heart wrenching process because it impacts a lot of our friends and colleagues. In a short span of four years, we have achieved a lot. MPL India was on track to continue the amazing business performance we have seen since December, when we turned EBITDA positive. In fact, we recorded our best ever month in terms of business performance in June and we beat that in July. If anything, this makes this decision all the more difficult to come to terms with.
 
What we have collectively done shows how phenomenal this team truly is, and we can’t thank you enough for that. Your resilience, resolve and unwavering dedication is what has brought us where we are today. We know how demotivating this may be to all of you after all the hard work you have put in over the years. Personally, this is the toughest decision we have ever had to make. It’s as if we aced our class and now find ourselves needing to repeat a school year. But I guess that’s how life is, sometimes you get good fortune and sometimes you don’t.
 
You have our promise that we will proceed with the utmost respect, compassion, and empathy. To everyone who is leaving us, while nothing can truly be enough, we are committed to providing you the best possible support during this transition. We recognize that these changes will also affect your personal life, and the company is here to offer any assistance you may need during this period. We will also do everything in our capacity to help you find new opportunities.
 
We have spent a lot of time evaluating and re-evaluating this decision; asking ourselves if we should wait or not. Eventually, we came to this conclusion because we believe that in uncertain times the sooner we are able to deliver certainty to everyone, the better. As we get through this, we want all of you to know that you can count on both of us to answer any questions you have and to support you through any difficult situations you may face now or in the future.
 
As for the future of MPL, we are very confident we are going to get through this, together as a team, and we will rebuild our business stronger than ever.
 
With the Utmost sincerity,
Sai and Shubh

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