Grab to implement cost cuts and freeze hiring, CEO Anthony Tan says in internal memo to staff

Superapp Grab is rolling out cost-cutting measures to cope with an uncertain macroeconomic situation, the company’s chief executive told its staff in an internal memo today (Dec 15).

The cost-cutting measures include a hiring freeze, salary freezes for senior managers, and budget cuts in both travel and expense, according to the memo which was viewed by Reuters.

The company will freeze the majority of current open job applications which are not in an offer stage, and will review requests to backfill and fill critical roles, wrote CEO Anthony Tan in the memo.

Meanwhile, certain leaders at the company would not be eligible for raises in their upcoming reviews, and the travel and expense budget will be reduced by another 20 per cent from its last guidance.

Despite bumping up its 2022 revenue forecast a week ago as it reported a strong third quarter performance, CEO Anthony Tan said in the memo that “Southeast Asia has not, and will not, be spared from rising prices and interest rates, as well as the consequent effects on growth”.

A path towards sustainable growth and profitability

“None of these decisions were easy, but are meant to help us get leaner and fitter, as we accelerate even faster towards sustainable, profitable growth,” said Tan in the memo.

In addition, Tan urged “Grabbers” to adopt a frugal and prudent mindset as the company prepares for 2023.

The new measures will also “help [the company] avert knee-jerk reactions that may interrupt [its] plans down the road,” he said.

Over the past two years since the pandemic, Grab has been cautious with how it has spent money, which include streamlining some of its business arms, tapering down incentives as well as slowing down hiring. According to Tan, these measures have helped Grab get closer to its profitability goals.

Grab joins the slew of tech layoffs

Established in 2012, Grab operates in 480 cities in eight countries, and had about 8,800 staff at the end of 2021, according to Reuters.

Earlier this year, in September, Grab’s chief operating officer, Alex Hungate, said that the company did not envision having to undertake mass layoffs as some other tech giants have done. Instead, the company would selectively hire.

In fact, the company listed 480 available positions on its career page last month, with almost a quarter of these positions based in Singapore. As of writing, the number of open positions has dwindled to 323 positions.

Ever since the company went public with an IPO, its share price has also tumbled more than 60 per cent. The company has had to continuously assure investors that it has plans to make itself profitable over the next few years, most recently at its first investor day back in September.

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