Reorganising ourselves to build an

enduring Carousell
Earlier today, I sent the following note to all our teammates at Carousell Group.

Hello teammates of Carousell Group,

I’m writing today to share very difficult news with you.

Together with my co-founders and group leadership, we decided to reduce the size of our team
by about 110 roles, representing 10% of our group’s total headcount. Only teammates from
some business units are affected.

In the next few minutes, emails will be sent to everyone in affected business units, clarifying if
your role was impacted. For those impacted, the email will be a calendar invite to a meeting
today with a leader in your team and a HR business partner.

I am deeply sorry for this outcome, and I take responsibility for the decisions that have led us
here. Parting with teammates, whom we are grateful to for joining us on this mission, is a very
difficult decision. We will be sure to treat everyone impacted with compassion and to lend as
much support as we can to them. More details will be provided later in this note.

Why and how we got here

As we emerged from the Covid lockdowns of 2021 across key markets of our group, we were
optimistic about the recovery to come and eager to reignite growth in our core classifieds
business. Additionally, we doubled down on a number of new initiatives to make selling and
buying more convenient and trusted, to make secondhand the first choice for even more people
across the region. That meant creating more teams to work on these initiatives, which included
new teammates that we had to hire.

Looking back, I’d made the following critical mistakes: First, I was too optimistic about the pace
of our impact versus our increase in investments. The reality is that we were quick to grow our
expenses and hire, but the returns took longer than expected. Second, while it is easy to blame
market conditions, I also underestimated the impact of growing our team size too quickly–larger
teams lead to lack of clarity in decision making and the additional coordination required to get
things done.
It does not help that the worsening macroeconomic environment presents more headwinds to
the growth expected. As early as March this year, we saw signs of what has been called the
“perfect long storm”: high inflation, geopolitical risks and supply chain disruption. In recent
weeks, things have taken a turn for the worse. The global economy continues to face steep
challenges, with economists expecting a broad-based slowdown in 2023.

We cannot change the wind, but we can adjust our sails

As we do not know when market conditions will improve, it is only prudent that we get to
profitability as a group as quickly as possible, to be masters of our destiny and build an enduring
company.

It is important to act swiftly, course correct, and right size our investment levels to better align
with this new reality. Your leaders and I have spent the last few months finding as many
non-people cost savings as possible–combing through our budget, line by line and business unit
by business unit. We are moving to an office with significantly lower rent, and the co-founders
and group leadership will take voluntary pay cuts. Yet, this is far from enough.

In order to accelerate our path to profitability, we will need to reorganise to focus on critical
priorities and operate more efficiently. Growing with more discipline and focus will exact a heavy
price: we will have to part ways with some of you–our teammates, our supporters and our
friends, who have believed and worked so hard on our mission together.

What we’re doing for those impacted

Our main priority is to lend as much support as we can to those impacted as they find their next
opportunity. To do so, for all impacted regular employees, we will:

● Offer 1 month of salary for every year of service, rounded up to the nearest half year. We
will ensure that every impacted teammate will have at least 3 months of compensation,
topping-up the difference where necessary.
● Encash all paid time-off balances and waive claw-backs on sign-on/retention bonuses
and relocation support, where applicable.
● Accelerate ESOP vesting of 25% for teammates with ESOP grants and who have been
with us for more than 6 months, but have yet to hit their first year cliff.
● Extend medical benefits and insurance coverage for teammates and their dependents
up to June 30, 2023, subject to approval by local insurers and medical service providers.
● Encash the 2023 ‘Wellness Pocket’ flexible benefit entitlement, if applicable
● Provide tools for job search, including letting impacted teammates keep their office
laptop and continue their LinkedIn Learning membership until June 30, 2023.
● Provide access to an Employee Assistance Programme and counselling services for
emotional and mental support.
 ● Make available our internal talent acquisition team and affiliated agencies to provide
career counselling and employment assistance.
● Plan to have staff on employment passes serve their full notice so that their right to stay
is not terminated early, unless they would prefer not to.
● Continue to provide access to communication tools (Gmail and Slack) to let teams say
goodbye to colleagues and friends, although we will be removing access to business
and operations systems.

If you are impacted, your HR BP will share more details in the meeting with you today.

The way forward

In the past decade, together we have been able to touch tens of millions of lives across
Southeast Asia, and make more possible for our community. In the next decade, and especially
in the difficult economic times ahead, we firmly believe that our mission is more relevant than
ever. Carousell will be there to help people make ends meet by making selling accessible to all,
help others afford and buy what they need, and create a more meaningful and sustainable
future of consumption by making secondhand the first choice.

We will learn from our mistakes, adjust and course correct quickly to make the biggest impact
we can for our community. Moving forward, we will sharpen our priorities as a company, keep a
watchful eye on costs and only invest in high conviction initiatives that are properly set up for
success. We will gather next week to reiterate our strategic choices and share the refinements
we will be making to reflect our learnings.

This week, let us focus on helping our impacted teammates who will be leaving us.

To our teammates who are leaving, I am deeply sorry. This decision today is by no means a
reflection of your contributions, dedication and hard work during your time with us. Please know
how truly grateful we are that you chose to join us on this mission. You have our most heartfelt
gratitude for being part of our journey.

best,

Siu Rui