It has been a difficult month in the technology sector. We’ve rounded up week-over-week layoffs, and according to aggregator layoffs.fyi, more than 15,000 tech workers have lost their jobs this month. Let’s hope the sun comes out in June.
Several tech companies that enjoyed pandemic-related surges are facing a correction, due to a host of factors, from rising inflation, economic hardship, war and changing consumer taste buds. Companies like Meta and Twitter have publicly announced hiring freezes, while Snap confirmed this week that it’s slowing hiring because it’s missing revenue targets.
It’s worth noting that a change in the hiring cadence, coupled with the Great Resignation, could mean that the workforce is sharply declining at the aforementioned companies, as people leave and companies are slow to fill those vacant positions.
On Thursday, the enterprise e-commerce platform Vtex announced that it would lay off 193 employees, representing around 13% of the Brazilian unicorn team.
“The world is changing rapidly and we must adapt,” founders and co-CEOs Geraldo Thomaz and Mariano Gomide de Faria wrote in a letter to employees. “The decision to reduce our workforce was made as a strategic judgment about what organizational structure can meet our adjusted priorities.”
The founders stated that they do not plan another round of layoffs and will not reduce investments in developing their talent despite their “high-efficiency mindset.” Vtex has also compiled a public spreadsheet for laid-off workers to share that they are looking for work. So if you are looking for fintech talent based in Brazil, here you are.
PayPal laid off dozens of employees at its San Jose headquarters, documents show. As first reported by The Information and later confirmed by TechCrunch, the layoffs affected 83 employees. This is a very small fraction of PayPal’s staff, which has more than 30,000 employees.
The PayPal layoffs, which just came to light, took place about a week before the fintech confirmed it would be closing its San Francisco office. When asked about this round of layoffs, a PayPal spokesperson told TechCrunch that it is “constantly evaluating how we work to ensure we are prepared to meet the needs of our customers and operate with the best structure and processes to support our priorities.” strategic business strategies as we continue to grow and evolve.”
He did not speak directly about the filing and the layoffs, but said he will continue to hire. PayPal did not provide specific details about the severance packages offered to the affected employees.
Getir, the $12 billion fast trading startup, is cutting 14% of its staff globally. It has been estimated that the Turkish company employs around 32,000 people in nine markets, which means that these layoffs will affect around 4,480 people. The company also said it will reduce hiring, marketing investments and promotions (not the human resources kind, the coupons kind for hungry customers).
Just two months ago, Getir raised another $768 in funding, valuing the company at $12 billion as it looked to deliver groceries to customers in minutes. Like other startups, we may see that valuation drop.
“There is no change in Getir’s plans to serve the nine countries in which it operates. In these challenging times, we are committed to leading the ultra-fast grocery delivery industry that we pioneered seven years ago,” Getir wrote in a memo to employees.
The delivery business is a challenging space in which to make a profit, and the macroeconomic downturn is clearly not helping. US-based delivery companies have also been hit: Philadelphia-based startup Gopuff also downsized earlier this year and delayed plans to go public.
A rival of Getir, gorillas it also endured a difficult week of layoffs, laying off roughly half the staff at its Berlin headquarters.
the Instant grocery delivery company raised nearly $1 billion at a $3 billion valuation alone seven months ago, but this week, it laid off about 300 employees. The company is also withdrawing from the Italian, Spanish, Danish and Belgian markets and will shift its focus to its home market, Germany, as well as France, the Netherlands, the UK and the US.
A source told TechCrunch’s Ingrid Lunden that the company was estimated to be down to its last $300 million. That may sound like a lot, but not when you’re not making a profit and spending between $50 and $75 million per month. The gorillas refused to verify that claim.
From Getir to Gorillas, we may be looking at a market correction after instant delivery became a necessity during the pandemic lockdowns. Although we are not yet safe from COVID-19, many customers are now more confident going to the grocery store than they were in 2020. Therefore, delivery companies are facing music.
Latch, a proptech smart lock company that raised $152 million in known private equity before going public through a SPAC last year, is making another round of layoffs. Earlier this month, the startup cut 30 people, or 6% of its total staff, according to an email obtained by TechCrunch.
Now, as confirmed by a Friday night press release, Latch has announced that it has cut a total of 130 people, or 28% of its full-time employee base. Sources say the cuts affect chief revenue officer Chris Lee and vice president of sales Adam Sold.
In the email seen by TechCrunch, Latch CEO Luke Schoenfelder told staff that the first round of layoffs was carried out to “ensure Latch is on a path to sustainable growth.” He also said that Latch will scale back some areas of the business, but we’re not sure if that means cutting out entire products or simply cutting back on the resources behind each vision. TechCrunch has contacted Latch about the layoffs this week, but has yet to hear back at the time of publication.
Which is worse: Missing your revenue goals or filing early with the SEC to say you won’t meet your revenue goals? That’s what Snap did this week, noting in an 8-K filing that it expects second-quarter 2022 revenue and adjusted EBITDA to fall below its expectations.
CEO Evan Spiegel addressed Snap in a company memo, obtained by TechCrunch. Consistent with his comments on last quarter’s earnings, he wrote that Snap’s revenue has fallen short due to inflation, as well as the impact of the war in Ukraine on advertising. Spiegel also noted that last year’s iOS privacy change continues to plague the company.
According to the memo, Snap plans to hire more than 500 team members this year, in addition to the 900 offers already accepted. That’s a 41% increase in hiring year-over-year, but not as many new hires as the company had planned, as it pushes some planned hiring through 2023. Spiegel’s letter specified that the hiring pace for unopened positions would be it will slow down, but not Does not clearly state how current open roles may be affected.
Spiegel added that Snap will fill positions if current employees leave, as long as those roles are high priority. Additionally, Snap’s leaders have also been advised to review their budgets to find ways to cut costs; Hopefully, that doesn’t mean layoffs.
Buy now, pay later The Klarna company received two major pieces of bad news this week. First, The Wall Street Journal reported that it is cutting its valuation to raise new venture capital, which isn’t great for a company that has already raised more than $3 billion. This news comes just under a year after the Swedish fintech giant raised $639 million, led by SoftBank’s Vision Fund 2, at a valuation of $45.6 billion.
Then the other shoe dropped: Klarna co-founder and CEO Sebastian Siemiatkowski announced to a staff of 7,000 that 10% of the company would be laid off, meaning 700 people would lose their jobs in exchange for severance pay. for dismissal.
“I am no stranger to sharing good and bad news. However, today is the most difficult to date,” Siemiatkowski wrote in a message to employees. “As much as we like it to be that way, Klarna does not exist in a bubble.”
The CEO’s message does not list a clear reason for the layoffs, but cites a variety of changing macroeconomic and geopolitical factors that have affected the fintech company.
“When we set out our 2022 business plans in the fall of last year, it was a very different world than the one we are in today,” he said. “Since then, we have seen a tragic and unnecessary war unfold in Ukraine, a change in consumer confidence, a sharp rise in inflation, a highly volatile stock market and a likely recession.”
In announcing these layoffs on Monday, Klarna did not immediately tell employees whether or not they would keep their jobs. Instead, they had to wait for a calendar invite to learn their fate for the rest of the week. At least Klarna allowed them to work from home “in consideration of [their] privacy.”
One-click payment startup Bolt has laid off at least 100 employees and has marketing, sales and recruiting functions, the sources say. CEO Maju Kuruvilla confirmed workforce reduction in a blog post but it didn’t say how many people were affected or what features were addressed.
“It is no secret that market conditions in our industry and technology sector are changing and in the face of macro challenges, we have been taking steps to adapt our business,” Kurvilla wrote in the blog post. “In an effort to ensure that Bolt owns his own destiny, the leadership team and I have made the decision to secure our financial position, expand our track and become profitable with the money we have already raised.”
As of May 26, reports indicated that the number of affected employees was actually 185, or a third of Bolt’s workforce.
Instacart, a grocery delivery company that saw demand for its service skyrocket amid the pandemic, is slowing down hiring. As first reported the new york post and confirmed by TechCrunch.
“We hired more than 1,500 people in the last year and nearly doubled the size of our engineering teams. As part of our second half planning, we are reducing hiring to focus on our highest priorities and continue to drive profitable growth,” Instacart said in a statement to TechCrunch.
Instacart is no stranger to stress. In March, the day after announcing a new growth plan, the company cut its valuation by nearly 40% from about $39 billion to $24 billion.
Co-founder Apoorva Mehta stepped down as CEO of Instacart in July, to be replaced by Facebook executive Fidji Simo. Her promotion to chief executive officer came as the pandemic ends and parts of the world begin to reopen, a crucial time for the company to rethink how it conducts business. Under Simo, some executives have left, including the head of payroll and the head of talent.