China's Xiaohongshu cuts 9% of staff in layoffs
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FILE PHOTO: A man walks past the booth of Chinese startup Xiaohongshu, which means "little red book" in Chinese, at the Big Data Expo in Guiyang, Guizhou province, China May 27, 2019. REUTERS/Stringer
By Josh Ye
HONG KONG (Reuters) -Chinese social e-commerce app Xiaohongshu, known as China's answer to Instagram, said it had cut about 9% of its staff as the company joined other internet firms in retrenching.
The layoffs come after an annual performance review conducted in March found that 10% of its employees had failed to perform to expectations, a spokesperson for the company said.
The layoffs were first reported earlier on Thursday by local media outlets such as Sina Technology, which cited social media postings by employees. Sina Technology also said the layoffs affected multiple departments of the company in Beijing and Shanghai.
Founded in 2013, Xiaohongshu has more than 2,000 employees across several cities in China. Its name translates to "Little Red Book".
The Shanghai-based company, backers of which include Tencent Holdings, Alibaba Group and Singaporean state investor Temasek Holdings, completed a $500 million fundraising round in November that valued it at as much as $20 billion.
Its job-cutting exercise follows such moves by other Chinese tech giants, including Alibaba and Tencent.
Reuters reported last month, citing sources, that Alibaba and Tencent would together cut tens of thousands of jobs this year in one of their biggest rounds of layoffs as they tried to cope with a sweeping regulatory crackdown.
New regulations have banned some of their old business practices and limited growth opportunities.
Xiaohongshu has also been targeted by Chinese regulators.In November it was called out by authorities for excessive collection of personal information. In January it was fined 300,000 yuan ($47,000) after state media reported it had failed to stop users from sharing lewd content featuring minors.
(Reporting by Josh Ye; Editing by Bradley Perrett, Kirsten Donovan)
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