Report: COVID-19 Causes Wonderschool to Lay Off 75 Percent of Workforce

Early Learning

Report: COVID-19 Causes Wonderschool to Lay Off 75 Percent of Workforce

Mar 25, 2020

Wonderschool, a San Francisco-based provider of startup, administrative and parent-matching services to home-based preschools, has laid off about 75 percent of its employees in response to lost demand over the COVID-19 outbreak.

Business Insider reports that Wonderschool has gone from about 65 employees to about 15. This follows a previous layoff in November of about 20 employees.

Wonderschool CEO Chris Bennett tweeted on Tuesday about the layoffs. He did not provide specific numbers, but he did say that the layoffs are due to shelter-in-place orders enacted in response to COVID-19. Governors in states including California and New York—two popular places for Wonderschool providers—have asked people not to leave their houses except for essential activities such as grocery shopping.

“This decision to part ways w/ valued members of our team was not at all a reflection on these individuals and their work, but rather, the reality that we are all facing right now,” he wrote.

In an email, Bennett said he wants the company prepared to serve customers for the long run. “There is lots of uncertainty in the market today,” he said.

Wonderschool, founded in 2016, has preschool providers sign a two-year contract to pay the company 10 percent of revenue in exchange for services, according to its website. The company has raised at least $21 million in investments, with backers including Andreesen Horowitz, Imaginable Futures (spun off from Omidyar Network) and First Round.

The company previously announced plans to expand in the areas of Chicago, Boston, Houston and Dallas. A blog post of which programs are still open to parents shows that Wonderschool has expanded into Massachusetts and Texas. Since the coronavirus outbreak, the company has also introduced virtual tours and fever checks for all parents, teachers and directors who enter a provider preschool.

Startups providing startup, administrative, marketing and parent-matching services to early learning programs have attracted major investor interest recently. In 2019, Homeroom, Sawyer, MyVillage, Winnie, Tinkergarten and Kangarootime together raised about $54 million from venture capitalists eager to cash in on growing childcare needs from tech-savvy working parents.

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