Sharan Hegde, the well-known financial influencer and founder of the 1% Club, has faced criticism after announcing the layoff of 15 per cent of his company's workforce. In a LinkedIn post, Hegde attributed the job cuts to the increasing role of artificial intelligence and what he described as "hiring mistakes."
However, the announcement—which also highlighted the company's profits, annual revenue, and a lavish 5,000-square-foot office in Mumbai—provoked a strong backlash on social media. Many criticised the tone of the post, calling it tone-deaf and insensitive given the context of the layoffs.
Hegde's decision to frame his LinkedIn post as a "business update" before addressing the layoffs also drew criticism from many users. In the post, he highlighted the company’s $8 million annual revenue, strong profitability, and large customer base while emphasising that the business is primarily self-funded and that investor money is invested in a fixed deposit earning 8.5 per cent interest. This focus on the company's financial success, followed by the announcement of job cuts, struck many as tone-deaf and indifferent to the employees affected by the layoffs.
The reaction was swift and widespread, with CEOs, influencers, and social media users alike criticising Hegde’s post. One X user wrote, “Sharan Hegde got cocky after a 10cr funding—leased a 5,000 sq ft office to flex on Instagram, went on a hiring spree, only to find AI was 10x smarter. Now he’s laying people off.”
While Hegde faced widespread criticism, he also received some support from a small group of users who defended his decision. These supporters argued that the critics likely lacked experience in business management and might not fully grasp the financial pressures or strategic choices involved in such moves.
In his original post, Hegde explained that the layoffs were the company’s first cost-cutting measure since its founding in 2022. He highlighted The 1% Club’s rapid growth—from a small team operating out of his home to a profitable, self-sustained business. According to Hegde, the increased use of AI has significantly boosted efficiency, reducing the need for human input in content creation and customer service.
Although Hegde assured followers that the laid-off employees were offered severance packages and assistance in finding new jobs, the backlash over the tone and timing of his message underscored the delicate balance businesses must strike between transparency and empathy in today’s climate.