Dive Brief:
- Brex cut 282 employees, roughly 20% of its workforce, on Tuesday, according to an email co-CEO and founder Pedro Franceschi sent to employees and posted on the company blog. The cuts are part of an effort to reduce layers of management and become profitable, Franceschi said in the post.
- As part of the management shuffle, Senior Vice President Camilla Morais will replace Michael Tannenbaum as chief operating officer, while Tannenbaum will take a seat on the board. Chief Technology Officer Cosmin Nicolaescu will transition to an advisory role. Director James Reggio will be promoted to vice president of engineering and report directly to Franceschi, the post said.
- “Looking inward, I realized we grew our org too quickly,” Franceschi said in the message. He claimed the cuts and restructuring will put the company “on a clear path towards profitability and independence.”
Dive Insight:
Tuesday’s restructuring echoes cuts from two years ago, when the company trimmed 136 employees, or 11% of its workforce at the time. Then-Chief People Officer Angela Crossman anticipated further cuts across the industry in 2023 as fintech startups pushed for profitability, she said in an interview at that time.
The cuts come despite Brex taking on billions of dollars in deposits in the wake of the collapse of Silicon Valley Bank last year, as reported by The Wall Street Journal.
Brex has shuffled its C-suite before, too. In an interview last October, Tannenbaum told CFO Dive that he had first joined the company as chief financial officer, but had been acting as COO before officially taking that title.
In a LinkedIn post, Nicolaescu shared a spreadsheet of Brex employees impacted by the job cuts. Of the nearly 175 employees who opted into the spreadsheet, 71 had the term “software engineer” in their title, 40 had “manager,” and 10 had “data scientist.”
When asked for comment on Tuesday’s job cuts, a spokesperson for the company pointed to the blog post by Franceschi.
