Sharan Hegde of 1% Club faces criticism after laying off 15% employees

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 about company profits, annual revenue, and a flashy 5,000-square-foot Mumbai office—sparked backlash across social media, with people calling it insensitive.
The fact that Hegde’s LinkedIn post provided a “business update” before mentioning the layoffs did not go down well with many users too. For instance, he detailed the company’s $8 million annual revenue, high profitability, and significant customer base while emphasising that the business is largely self-funded and has invested investor money in a fixed deposit earning 8.5% interest. This business-first approach, followed by the layoff announcement, struck many as indifferent to the affected employees’ situation.
The reaction was swift, with CEOs, influencers, and everyday social media users criticizing Hegde’s post. Zoho CEO Sridhar Vembu voiced his disapproval on X (formerly Twitter), comparing the layoff trend to that of some cash-rich corporations that prioritize shareholder gains over employee welfare.
Vembu said, “A company that has $1 billion cash, which is about 1.5 times its annual revenue, and is actually still growing at a decent 20% rate and making a cash profit, laying off 12-13% of its workforce should not expect any loyalty from its employees ever. And to add insult to injury, when it can afford $400 million in a stock buyback.”
“I can understand the unfortunate reality of layoffs when a business is struggling or declining and making a loss. This is not that situation, this is naked greed, nothing less,” Vembu said.
“Here is a critical question to its leadership: don’t you have the vision and imagination to invest $400 million in another line of business where you can deploy those people you hired but you don’t want anymore? Are there no such opportunities in tech? Are you so lacking in curiosity, vision and imagination? Are you so lacking in empathy?” Vembu asked.
He remarked that such behaviour breeds employee cynicism, a phenomenon he argued was being imported from US corporate practices into India. “We put our customers and employees first. Shareholders should come last,” Vembu added.
Critics on LinkedIn echoed this sentiment, dissecting Hegde’s approach in a sarcastic fashion. One user, Clarence Johnson, broke down the perceived insensitivity in Hegde’s post step-by-step, pointing out the irony of strategic boasts of profitability, and what he deemed a cursory mention of employees’ livelihoods.
Even on X, users didn’t hold back. One user remarked, “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.”
Others critiqued the financial influencer’s own financial literacy, advising people to think twice before relying on influencer-backed financial advice or “Ponzi-like schemes.”
Humorous takes also emerged, with jokes about the “1% Club” now having fewer members after reducing its team by 15%, or possibly redefining itself as the “0.85% Club.”
However, Hegde did receive some support from a minority of users who defended his decision, arguing that critics likely haven’t managed a business themselves and might not understand the financial pressures or strategic calls involved.
In his original post, Hegde explained that the layoffs were the company’s first cost-cutting measure since its founding in 2022.
He described The 1% Club’s quick rise from a small team working out of his home to a profitable, self-sustained enterprise. According to Hegde, AI has enhanced company efficiency, reducing the need for human input across areas like content creation and customer service.
Though Hegde assured followers that laid-off employees received severance packages and support for new job placements, the uproar over the way he communicated the layoffs has highlighted the challenges of balancing transparency with empathy in today’s business climate.