Esports and skill gaming unicorn Mobile Premier League (MPL) is laying off 100 people, which represents about 10 per cent of its workforce, and is exiting the Indonesian market, reported Money Control. This comes days after MPL investor Sequoia advised investee companies to preserve cash amid global uncertainty.
Only last December, the company announced plans to expand operations to Hyderabad with a capacity of 500. Last week, we have reported that real money gaming companies may go slow on advertising spending in IPL and other major tournaments due to the global slowdown.
The Bengaluru-based company is also doing away with its streaming product on the MPL app. “The last few months have been insane. The philosophy of growth at all costs is now reversed. The market is now rewarding profitable growth overgrowth at all costs,” MPL co-founders Sai Srinivas and Shubh Malhotra said in an email to employees, as reported by Moneycontrol.
“It’s imperative that we as a company respond to this change and respond fast. We have always said that the market is like a flowing river – you cannot fight it, you have to row downstream,” they said.
In the email, the founders said they are exiting Indonesia since the “return profile has been several multiples lower” than what they were and are seeing in India, or even in their nascent US business, despite investing significant resources and capital over the last three years into Indonesian operations.
People who are being let go will receive complete severance along with other benefits. ESOP holders will be given an opportunity to hold onto their options for an additional 10 years, as per the Money Control report.
The mobile gaming segment was one of the big beneficiaries of the COVID-19 pandemic that forced people to stay indoors which resulted in a massive surge in mobile game downloads and user engagement. Mobile app downloads in India had increased by 50 per cent and user engagement rose 20 per cent, according to a recent report by consulting firm RedSeer.