Sharan Hegde, the popular financial influencer and founder of the 1% Club, has come under fire after laying off 15% of his company’s workforce. In a LinkedIn post, Hegde cited the growing role of artificial intelligence and what he called “hiring mistakes” as factors behind the job cuts.

However, his announcement – which included details of the company’s profits, annual revenue and a glitzy 5,000 sq ft office in Mumbai – sparked backlash on social media, with people calling it insensitive.

The fact that Hegde’s LinkedIn post provided a “business update” before noting that the rollouts didn’t go well for many users either. For example, he detailed the company’s $8 million in annual revenue, high profitability and significant customer base, while pointing out that the business is largely self-funded and has invested investors’ money in a fixed deposit that earns 8.5 % interest. This business-first approach, followed by the layoff announcement, struck many as indifferent to the plight of the affected employees.

Backlash was swift, with CEOs, influencers and regular social media users criticizing Hegde’s post. Zoho CEO Sridhar Vembu expressed his disapproval of X (formerly Twitter), likening the layoff trend to that of cash-rich corporations that prioritize shareholder gains over employee well-being.

Vembu said: “A company that has $1 billion in cash, which is about 1.5 times its annual revenue, and is actually still growing at a decent 20% rate and making a profit on cash, firing 12-13% of the workforce should not expect. any loyalty from its employees ever. And to add insult to injury, when he can afford $400 million in a share buyback.”

“I can understand the unfortunate reality of layoffs when a business is struggling or in decline and making a loss. This is not that situation, this is greed, nothing less,” said Vembu.

“Here’s a critical question for his leadership: Don’t you have the vision and the imagination to invest $400 million in another line of business where you can deploy those people that you hired but didn’t do you want more Are there no such opportunities in technology? Are you so lacking in curiosity, vision and imagination? Are you that lacking in empathy?” Vembu asked.

He noted that such behavior breeds employee cynicism, a phenomenon he argued was imported from US corporate practices to India. “We put our customers and employees first. Shareholders should come last,” added Vembu.

Critics on LinkedIn echoed this sentiment, dissecting Hegde’s approach in sarcastic fashion. A user, Clarence Johnson, broke down the perceived insensitivity in Hegde’s post step by steppointing out the irony of strategic boasts about profitability and what he considered a superficial mention of employees’ livelihoods.

Even on X, users did not hold back. One user remarked“Sharan Hegde showed up after a 10-crore funding – rented a 5,000-square-foot office to hang out on Instagram, make hires, only to find that the AI ​​was 10 times smarter. Now they’re firing people.”

Others have criticized the financial influencer’s own financial knowledgeadvising people to think twice before relying on financial advice endorsed by influencers or “Ponzi-like schemes”.

There were also humorous ads, with jokes about the “1% Club” now having fewer members after reducing its team by 15% or eventually redefining itself as “The 0.85% Club”.

However, Hegde received some support from a minority of users who defended his decision, arguing that the critics probably haven’t managed a business themselves and may not understand the financial pressures or strategic calls involved.

In his initial post, Hegde explained that the layoffs were the company’s first cost-cutting measure since its inception in 2022.

He described the rapid rise of the 1% Club from a small team working out of his home to a profitable, self-sustaining enterprise. According to Hegde, AI has improved the company’s efficiency by reducing the need for human intervention in areas such as content creation and customer service.

Although Hegde assured followers that the laid-off employees received severance packages and support for new jobs, the uproar over how he communicated the layoffs highlighted the challenges of balancing transparency with empathy in today’s business climate.