Crypto exchange Kraken has laid off a portion of its staff in a move toward “leaner and faster” operations.

The firm made the announcement October 31 but did not detail who the layoffs affected. About 15%, or roughly 400 of the company’s 2,600 employees, were cut from Kraken’s workforce, including former operations chief Gilles BianRosa and technology chief Vishnu Patankar, The New York Times reported, citing two unnamed sources.

“As we’ve grown north of $1 billion in net revenue as a remote organization worldwide, we fell into the trap of building organizational layers,” co-CEOs Dave Ripley and Sethi wrote in a blog post on the layoffs. “We are making organizational discipline decisions to tackle this problem and eliminate layers.”

They didn’t provide severance information but wrote that the company “will support [those affected] during this transition.”

“We need to make sure our top contributors are focused on building rather than managing,” they wrote. “This means we give more power to our leaders to build best-in-class products, leverage data to make decisions that are best for our clients, and make engineering, product and design teams all feel more accountable for results.”

A spokesperson for the company declined to comment further.

Blockchain software company Consensys laid off 20% of its employees, chalking it up to challenging macroeconomic conditions and ongoing regulatory uncertainty.

The layoffs, announced in a blog post by CEO Joseph Lubin, affect around 162 of Consensys’ 828 employees, according to Cointelegraph.

On top of rising interest rates and inflationary pressures, the lack of clear regulatory frameworks “has made navigating our evolving space unnecessarily complex for innovators, builders, investors, and businesses,” Lubin wrote, noting the number of ongoing battles between crypto firms and the Securities and Exchange Commission, including his own.

“This is all unfolding within a web3 ecosystem that is evolving rapidly. Our sector is about to go mainstream with web3-native companies making great strides and more traditional companies leaning into web3,” he wrote. “Looking ahead, I see a next generation economy not dominated by large monolithic companies; instead, smaller, agile, AI-supercharged companies with web3-based coordination tools will operate more efficiently.”

“To stay competitive in this fast-growing space, we need to reshape ourselves and be more agile, more effective, and even higher-performing,” he wrote.

Lubin said layoffs are required for the sustainability of the firm best known for its self-custodial MetaMask crypto wallet.

Affected employees will receive severance based on tenure and job placement support, along with extended healthcare benefits and an extension of the stock option exercise window from 12 months to 36 months, “recognizing the value these team members have contributed.”

Consensys’ core business, Lubin said, remains strong, and the decision to “right-size” the company was “hard,” he wrote.

In an interview with Cointelegraph, Lubin said the layoffs are motivated “by a variety of factors, and to me, it feels like they’re pretty equal. The first obvious one, which is not necessarily more important than the others, is just the long-term financial sustainability aspects in the face of potential economic volatility.”

Consensys seeks to become a “smaller, much more agile organization,” one better equipped to capitalize on “broad and deep capabilities” the firm has built over its 10-year lifespan, he told the outlet.

More specifically, the company seeks to evolve from “a company into a network state overtime,” he wrote in the blog post, driving “progressively toward rigorous decentralization.”

Without details, Lubin wrote that the company will make several announcements in the near future to demonstrate its commitment to decentralization.

Digital asset-focused Custodia Bank laid off some employees amid its current battle with the Federal Reserve for a master account.

Founder and CEO Caitlin Long said in an emailed statement to Banking Dive that the bank was “right-sizing so we can maintain operations while preserving capital” during Custodia’s lawsuit against the Fed or “until after Operation Choke Point 2.0 ends,” she said, referring to the alleged ongoing crackdown on digital assets under the Biden administration. Operation Choke Point was the name of an Obama-era effort that “choked off” high-risk industries like payday lending, gambling and firearms from banking access.

Custodia notified employees on August 29 that nine of its 36 employees were being laid off, Fox Business reported.

The bank was denied a master account, which would give it access to the Fed’s liquidity facilities, including payment services, early last year. In April, a federal judge ruled that federal laws do not require the Fed to give every eligible institution a master account. The lawsuit is ongoing.

A person with knowledge of the matter told Banking Dive that Custodia is operating with its hands tied because of the high cost of not having its own Fed master account. It’s been debanked twice by partner banks, and “harassed by Fed regulators behind the scenes,” the person said.

Long said in an emailed statement that the digital-asset crackdown “has been devastating for the law-abiding U.S. crypto industry, and Custodia Bank has been hit hard despite our strong risk management and compliance track record.” 

Leading Democrats met with members of the crypto industry this month via Zoom in an attempt to repair relations, Fox Business reported Aug. 8. The meeting, however, had some sore spots: After Deputy Treasury Secretary Wally Adeyemo told attendees that the government had no coordinated effort to block the crypto world from the traditional financial system, a crypto executive asked for a show of hands of whose companies had been turned down for banking services due to White House policies.

Nearly all of the industry representatives raised their hands, two attendees told Fox Business.

A spokesperson for Custodia did not elaborate to Banking Dive on the roles affected by layoffs.

Tally, a credit card debt management platform, has closed its doors due to a lack of funds to run its operations, founder and CEO Jason Brown said in a LinkedIn post.

The nine-year-old fintech decided to shut down after considering all alternatives, underscoring the current difficulties facing financial technology companies.

“This was not the outcome we had hoped for, but after exploring all options, we were unable to secure the necessary funding to continue our operations,” Brown wrote without clarifying when the company notified its staff and customers about its decision. 

According to the company, Tally’s automated debt manager is the first of its kind, letting users link their various credit cards and paying them off on their behalf. It is built to save consumers hundreds of dollars in interest fees every year.

Founded in 2015, Tally has helped consumers pay down more than $2 billion in debt, the fintech noted. 

“Tally was designed to be more than just a tool; it was a financial coach working quietly in the background, automating payments and guiding users toward healthier financial habits,” Brown said. 

Tally showed signs of trouble when it sunsetted its direct-to-consumer loan portfolio in April and offered its line of credit through its partner network. It encouraged the credit line users to access its white-labeled business-to-business credit card debt management software through one of its partners, though users could also continue to use Tally’s suite of products directly within the application.

The product was slated to be launched in July 2024 by Tally’s first partner, a large publicly traded consumer company with over 50 million users, the company said. Tally raised additional capital from its existing investors to develop the B2B product.

“We started the company going straight to the people who needed it most,” Brown said in a statement in April. “But what we’ve discovered — and as market dynamics have gotten even more challenging — is that our overall impact can be much greater if we enable partners to leverage our technology.”

The company is backed by Kleiner Perkins, Andreessen Horowitz, Shasta Ventures, Sway and Cowboy Ventures and has raised over $200 million to build and scale its platform, the company said in April.

Tally’s most recent valuation was at $855 million with a workforce of 183 employees, according to PitchBook data. 

Before launching Tally, Brown founded Gen110, a consumer debt product that financed solar installations, and Bask, a remote technology support platform for consumers and small businesses globally.

“While this is the end for Tally, our expectation is that it is not the end of our mission. The need for financial tools that truly help people is as critical as ever. I hope that what we started with Tally will inspire others and influence new ideas and approaches to managing debt,” Brown wrote.  “As we close this chapter, I look forward to seeing what the future holds for each of us.”

Tulsa, Oklahoma-based Totem Technologies has shut down, the fintech’s founder and CEO, Amber Buker, said in a LinkedIn post.

The neobank, which had raised about $2.2 million in pre-seed funding, had about 500 customers, according to Buker.

Totem billed itself as “banking by and for Indigenous people,” whom it said are more likely to be unbanked and live farther from bank branches. The fintech, which had a mobile banking app that offered a spending account, debit card and early access to paychecks, rolled out its product to consumers in July 2023, American Banker reported. 

Pryor, Oklahoma-based First Pryority Bank provided banking services for Totem and issued the fintech’s debit card. The startup’s website also said it shared a portion of revenue with its tribal partners. One of those was the Eastern Shawnee Tribe of Oklahoma, which would publicize Totem’s services to its members in exchange for a cut of the fintech’s interchange revenue.

In her LinkedIn post, Buker didn’t provide details on when Totem notified customers of the company’s shuttering, or what specifically led to the startup’s demise. But she suggested investors wanted to see more progress, more quickly from the fintech.

“We built an ethical business model that showed it is possible to serve ‘risky’ or ‘niche’ populations when you build holistically and tap into the broader needs of their communities through value-add services like payments,” said Buker, an enrolled citizen of the Choctaw Nation of Oklahoma. “But businesses looking to serve Indian Country can only do so at the speed of trust. And that comes much, much more slowly than the pace at which a venture-backed company is expected to move.”

Buker remains involved in a legal dispute with Richard Chance, the fintech’s co-founder and former chief technology officer. Last year, he accused Buker of denying him a promised ownership stake in the company, American Banker reported. He also said she threatened legal action against him for misappropriating the fintech’s intellectual property.

“I am incredibly proud of the work we’ve done in just two short years to improve financial wellness and banking access for Native Americans nationwide,” Buker wrote. “We built a thoughtful, culturally relevant banking product for our People.”​

Intuit, the parent company of TurboTax and Credit Karma, has laid off 1,800 people, or 10% of its global workforce.

The layoffs are unrelated to cost cuts, according to a memo published online by CEO Sasan Goodarzi; rather, they were done so the company could place bigger bets on artificial intelligence, he asserted.

“The changes we are making today enable us to allocate additional investments to our most critical areas to support our customers and drive growth as detailed below,” he wrote. “This includes reinvesting in the necessary skills and capabilities to support these areas, and, as such, we will hire approximately 1,800 new people primarily in engineering, product, and customer facing roles such as sales, customer success, and marketing.”

Goodarzi also cleaned house with the layoffs, as he noted that some 1,050 employees were let go as a result of Intuit “rais[ing] the bar” on employee performance. 

Management was cut, too, with the number of executives reduced by 10% “to continue increasing our velocity of decision making and empowering our employees to deliver for our customers.”

U.S. employees are set to leave the company Sept. 9, after which they will have at least 16 weeks of severence pay and six months of health insurance coverage.

Goodarzi said he expects Intuit’s overall headcount to grow in 2025 and beyond.

Insurance giant Prudential shut down insurtech Assurance IQ, five years after snapping it up for $2.35 billion.

“As we look to the future, we believe that directly investing in our core businesses and capabilities will help us become a higher growth, more capital efficient company,” Caroline Feeney, head of Prudential’s U.S. businesses, wrote in a letter to employees seen by GeekWire in May. “After a careful review of our businesses and strategic initiatives, we have made the difficult decision to wind down our Assurance business.”

Prudential had noted in its first-quarter earnings report that it “decided to exit” the Assurance business. The company confirmed the shutdown in a statement to GeekWire.

A Worker Adjustment and Retraining Notification notice showed that layoffs of 112 people would begin July 3.

Assurance, which uses technology to match consumers with insurance plans, had around 1,000 employees as of May, according to GeekWire. Most of those employees would be laid off, CEO Allison Arzeno wrote in an email to employees in May.

“Together, we built something special here,” she wrote. “Our work made a difference. We helped hundreds of thousands of people navigate complex insurance tradeoffs and secure coverage that improved and protected their personal and financial well-being.”

The deal had been one of the largest in Seattle tech history, and the largest insurance tech exit ever, according to Financial Technology Partners, which served as adviser to Assurance in the deal.

NCR Voyix, whose technology systems are used by several major convenience store retailers in the U.S., laid off workers in June, Trish Nettleship, the company’s chief marketing officer, said in an email to C-Store Dive.

Atlanta-based NCR Voyix is a provider of self-checkout kiosks, point-of-sale systems, e-commerce platforms and loyalty programs.

Nettleship initially declined to share how many employees were let go, but the Atlanta Business Chronicle in August reported the company’s layoffs numbered around 800.

In recent days, over a dozen former staffers shared news of NCR Voyix’s layoffs and their respective terminations on LinkedIn. These individuals worked across several departments, including sales, engineering, professional services, data and product management.

About nine months before the layoffs, NCR spun off its ATM arm, Atleos, amid plans to solely become a software and services business focused on its retail, restaurant and digital banking businesses. The layoffs mark a continuation of this strategy, Nettleship said.

As of Dec. 31, 2023, NCR Voyix had about 15,500 employees around the globe, according to the company’s 2023 annual report. Roughly 5,400 of those employees were in the U.S. — the firm’s largest operating region, its report noted.

Nettleship declined to share an updated headcount for NCR Voyix’s employees in the aftermath of the reduction in workforce. She said the decision to reduce its staff “was not taken lightly” and that the company will support its departing team members amid their transitions.

“While this was a difficult decision, it is important to streamline our organization as we focus on accelerating profitable growth,” Nettleship said.

Prior to the company’s split, NCR went through several major restructurings since the turn of the millennium. It eliminated over 1,000 jobs in 2018, cut around 600 roles in 2009 and laid off 1,500 employees in 2002. 

In August, NCR Voyix said it agreed to sell its digital banking platform to Veritas Capital for $2.45 billion.

Venture capital firm Point72 let go of five partners, including three from its fintech team and two from its digital assets team.

The cuts, covered initially by Forbes, came as the firm aims to invest more in artificial intelligence and defense tech startups.

“We are always evaluating our portfolio’s performance and market opportunity, and optimising our strategy and resources around what we think is the biggest opportunity set,” a spokesperson wrote to Forbes.

Fintech is still listed as an area of expertise on Point72’s website. Last year, Point72 led a $15 million Series A round for GenTwo, a Switzerland-based business-to-business fintech focused on asset securitizations.

Small-business digital banking fintech Bluevine laid off about 20 employees, or roughly 12% of its Israel-based workforce.

In a statement to CTech, which reported the layoffs, the Jersey City, New Jersey-based company said that “from time to time, it is necessary to adjust priorities to ensure continued optimal response to changing market needs and ensure long-term success.”

“These changes include personnel adjustments aligned with the company's business strategy and priorities, such as personnel transfers between departments and job eliminations,” the company said. “While we regret this decision, it necessitates parting ways with approximately 12% of our employees in Israel.”

Despite the layoffs, the firm said it was “actively recruiting for open positions in Israel.”

Global payments provider Wex said it would lay off 375 people, about 5% of its 7,200 employees, in June.

“As the technology environment continues to change rapidly, it is imperative that WEX continues to evolve its business to support innovation and maintain its position as an industry leader,” a spokesperson said in an email to Mainebiz.

Most affected employees worked within Wex’s technology division, the spokesperson said.

“These changes, while difficult, will help us focus our resources, promote agility and efficiency, and further position WEX for long-term success,” the spokesperson said.

PayPal said in June it would cut up to 85 jobs from its 1,600-strong Irish workforce, Irish Examiner reported.

The company said that the proposed cuts are subject to consultation. These cuts were in addition to global reductions earlier in the year, which shed 205 Irish employees.

The cuts are part of a strategic transformation, the company said this year.

A spokesperson told the Irish Examiner that PayPal, which began operating in Ireland in 2003, is “committed to Ireland and its role as a critical hub for the company’s global operations.”

London-based fintech unicorn Rapyd laid off about 30 people in Israel, or about 3.75% of its local workforce.

The digital payments company is opting to move positions abroad to Eastern Europe and South America to cut costs, according to CTech.

The firm, which enables businesses to collect payments in local currencies, conduct payouts, and maintain digital wallets, is licensed in more than 40 countries and has 22 offices worldwide.

Embedded finance fintech Unit has cut 15% of its staff, according to a company blog post.

Co-founders Itai Damti and Doron Somech told affected employees June 17 and announced it publicly on a blog post shortly thereafter, citing slower than expected revenue growth and plans to become profitable without additional capital raises.

A Unit spokesperson would not confirm the amount of employees affected. According to PitchBook, Unit had 172 employees in 2023, meaning the 15% cut amounts to about 25 employees.

“We believe that our company needs to think in longer time frames,” they wrote. “Banks in the fintech ecosystem have slowed down in the last year due to increased regulatory scrutiny. While we believe that the slowness is temporary and Unit will actually benefit from the resulting regulatory clarity, it will take time. For now, we need to focus on efficiency and account for slower than expected revenue growth.”

The duo founded Unit in 2019 to build infrastructure enabling banks and technology companies to enter direct relationships. In five years, the company has grown to have eight bank partners and work with high-growth start-ups and publicly traded companies alike, serving 1.38 million end-customers in the first quarter of 2024 with an annualized transaction volume of $28.7 billion, according to data shared by Unit in May.

In May, Damti, also the CEO, addressed the increased regulatory scrutiny fintech faces, and the costs Unit has incurred to rise to the occasion.

“We’re at a point in time where the bar for operating in the space is rising quickly for banks, and Unit wants to be well-positioned to serve those banks and grow our partner bank network,” Damti told Banking Dive at the time.

In the blog post, Damti and Somech noted that their firm “has always maintained a large balance sheet, and the changes we are making today will further solidify our strength.”

“While we could choose to raise additional capital in the future, we’re executing on a plan to become profitable without the need to do it,” they wrote. “This independence will help us realize our mission - powering modern financial experiences - reliably and for the long term.”

“We believe that the end-customer demand for modern financial services is stronger than ever, and that quality infrastructure is the only way to power these services. Unit is still in its early days,” Damti and Semech continued. “We’ve recently seen strong and new types of demand for our product, such as banks using Unit and its white-label app to power their own bank-branded digital experiences.”

A Unit spokesperson declined to share details beyond the company blog post.

Indian buy now, pay later firm Simpl initiated a second round of layoffs, this time affecting around 30 employees, Economic Times reported.

Those affected include mid-senior management across various departments.

The cuts are a “continuation of our organization-wide efforts to become a fiscally prudent company and achieve profitability by mid-2025,” according to the company.

Ashish Kulshresta, Simpl’s head of communications, told the Indo-Asian News Service that the company routinely reviews its businesses “to improve efficiencies and become more agile and leaner as an organisation to drive consistent growth.”

Affected employees will receive a minimum severance of two months’ salary, plus an additional 15 days’ salary for each year they served with the company.

Investment crowdfunding platform Mainvest has ceased operations, leaving 14 people without jobs.

For five years, the firm focused on helping founders raise capital to run their businesses; and in that time, “community-dedicated investors deploy[ed] nearly $40mm of capital into brick and mortar entrepreneurs across the U.S., with the returns to their communities significantly outperforming traditional underwriting models,” according to the firm.

But it informed founders in May that a shutdown was coming, according to Startland News.

“We’ve operated as a small team, pushing towards profitability ourselves in an incredibly challenging capital environment, and, unfortunately, the implosion of our back end service provider proved to be the final wall that we were unable to break through, forcing the decision to wind the business down,” the firm said.

The implosion referenced was of Synpase, a middleware fintech that filed for bankruptcy in April after losing a number of key partners. Synapse’s bankruptcy froze access to money invested on the Mainvest platform, according to The Boston Globe.

Paytm parent company One97 Communications said it planned to lay off an undisclosed number of workers, according to the Economic Times.

The company said its human resources teams were collaborating with dozens of companies that are hiring to help affected employees find employment elsewhere, according to the report.

The digital wallet company didn’t share how many employees were affected.

The layoffs follow action by the Reserve Bank of India, which banned Paytm affiliate Paytm Payments Bank Limited from accepting deposits, credit transactions or top-ups in any customer accounts or wallets from March 15 onward for “persistent non-compliance.”

Paytm Payments Bank is 49% owned by Paytm and 51% owned by its CEO, Vijay Shekhar Sharma, according to Reuters.

Several laid-off employees have filed complaints with the labor and employment ministry seeking reinstatement, according to the Times of India. The former employees claim that Paytm management acted unfairly and unethically in their termination practices. Some complaints allege forced resignation, according to the report.

Paxos laid off 65 employees, or roughly 20% of its staff, the crypto firm’s CEO, Chad Cascarilla, told employees in an email seen by The Block.

The move “allows us to best execute on the massive opportunity ahead in tokenization and stablecoins,” Cascarilla wrote.

“Stablecoins will 10x in the coming years and serve as the fulcrum for opening the financial system through tokenization,” he wrote. “We will continue to consolidate focus on our core offering and de-prioritize adjacencies.”

With the move, Paxos plans to phase out its settlement services in commodities and securities, and boost its focus on tokenization of assets and on stablecoins, a person familiar with the situation told Bloomberg.

Paxos offered affected employees 13 weeks of severance pay, three months of subsidized health insurance, three months of outplacement support and a two-year extension to exercise vested options, Cascarilla wrote, according to The Block.

The company also gave second-quarter bonuses to employees who were on a quarterly incentive program, as well as payments and benefits to workers with approved parental or medical leave, along with the separation package, the publication reported.

“This is a tough day,” Cascarilla wrote, according to Bloomberg. “I take responsibility for this decision and regret having to take this course.”

Cascarilla, however, noted that the company has more than $500 million on its balance sheet, adding that Paxos is “in a very strong financial position to succeed.”

The layoffs came roughly a week after Paxos launched the yield-bearing stablecoin Lift Dollar. But, Cascarilla wrote, “launching and scaling new regulated tokens takes time.”

Crypto payments infrastructure firm MoonPay cut 10% of its staff, amounting to around 30 people, The Block reported.

“Today we are implementing a series of role eliminations, role relocations, and structural changes which impact about 10% of our staff,” MoonPay co-founder and CEO Ivan Soto-Wright said in an email. “These changes will allow us to improve our cost structure and strengthen our foundation.”

Soto-Wright wrote in the email that MoonPay is “financially sound and strong with years of runway ahead.”

But the company’s margins are “not where they should be” after over-investing in certain areas and geographic regions, he said.

Credit fintech Pagaya laid off 100 employees, mostly based in Israel, according to CTech.

That amounts to 25% of its Israel-based workforce and about 18% of its global workforce.

The layoffs follow a round last year that resulted in 140 employees being laid off.

Most of the firm’s Israeli workforce focuses on research and development, CTech reported. Pagaya’s first-quarter filing showed revenues of $245.2 million, a 30% year-over-year increase. But it also recorded a loss of $21.2 million, and sources close to the company told CTech the current cuts were meant to more quickly achieve profitability and positive cash flow.

In July, Pagaya entered an agreement to purchase Theorem Technology, a consumer credit funds manager that oversees more than $1.7 billion for endowments, foundations, sovereign wealth funds, pensions, healthcare organizations, insurance companies and family offices globally.

Spend management platform Tropic laid off 40 people amid restructuring in May, CEO David Campbell wrote on LinkedIn.

“Our vision is to make technology a buyers’ market, and the changes below will accelerate a period of rapid growth in the [software-as-a-service] product we built to enable this vision,” he wrote. “At the same time, we need to somberly acknowledge the importance and incredible quality of the impacted people that helped us get to this point.”

The layoffs weren’t performance based, he wrote, and the company intended to help affected workers land jobs elsewhere.

Following the debut of its software-as-a-service platform last year, growth “positioned [Tropic] to operate as a leaner, more focused team,” requiring operational changes.

“But turning this corner comes at the cost of 40 extremely talented people. We never could have gotten to this moment without them, and all of their fingerprints will be on this business forever,” Campbell wrote. “We are grateful.”

Funding Circle laid off 120 people as part of a set of “cost efficiency actions,” according to a May announcement.

The changes will create a “simpler, leaner and better positioned” U.K. business, according to the announcement.

“We are pleased to report continued momentum on the path we set out in March to become a simpler, profitable business,” said CEO Lisa Jacobs. “The reduction in roles is not a decision we took lightly, and I would like to thank all the departing team for their hard work and commitment.”

The reduction in roles will contribute to a cost savings of ~£15 million in 2025, the company said.

Buy now, pay later startup Simpl let go of about 160 of its 650 employees, Moneycontrol reported.

The India-based fintech’s cash burn was elevated, people familiar with the matter told Moneycontrol, and new user acquisitions have been slow, leading to the cuts.

“Founder and CEO Nityanand Sharma had a brief all-hands townhall with employees today at 9 am. It seemed he was reading out of a prepared script. He said we are sorry to let go people and will do our best to help with stuff like outplacement,” according to the source.

The job cuts are tied to cost cutting as Simpl works toward profitability, the source told Moneycontrol.

Crypto firm Bakkt laid off 28 people, or roughly 13% of its non-call center workforce, according to a securities filing.

The workforce reduction is part of a strategic review of Bakkt’s operations, and the company intends to more effectively align its resources with its priorities, according to the filing.

Earlier this year, Bakkt shuffled its leadership and named Andy Main, previously of advertising powerhouse Ogilvy, its new CEO.

Bakkt said it would incur between $800,000 and $1 million related to its layoffs, most of which related to severance and benefits.

Synctera laid off 17 people, or about 15% of the company, amid restructuring first announced by Fintech Business Weekly.

The banking-as-a-service startup had recently announced an $18.6 million extension round to the $15 million Series A it announced in March 2023.

“Synctera has conducted a restructuring of the company that resulted in a reduction in staff and we are dedicated to assisting those who are impacted,” a company spokesperson told Fintech Business Weekly. “We are committed to our current line of business along with the addition of SaaS offerings for banks and companies.”

Earlier in the year, CEO Peter Hazlehurst spoke with Banking Dive about navigating regulatory challenges in the BaaS space.

Nigerian cross-border payments company Chipper Cash let go of 20 employees in March, its fourth round of layoffs within one year.

CEO and co-founder Ham Serunjogi attributed the layoffs to organizational shifts: moving certain U.S. and U.K. roles to people based in Africa.

“These are people who have been instrumental to the growth and success of Chipper, and I thank them for their many contributions,” he wrote in a company blog post announcing the cuts.

With the cuts, the company is “almost profitable” and Serunjogi expected it to be cash-flow positive before the second half of this year, he wrote at the time.

“Being a company that controls its own destiny isn’t just prudent, it is a competitive advantage,” Serunjogi wrote. “This change will also allow us to be more operationally efficient in a number of key functions. After our acquisition of Zoona/Tilt last year, we now have even more teams and offices across multiple countries. It is important we continue to pay attention to maintaining a high level of operational efficiency, in addition to cost efficiency.”

Subscription investment platform Stash, valued at $1.4 billion in 2021, laid off a quarter of its workforce, Axios Pro reported.

At its peak, the firm had roughly 500 employees. After these cuts, which followed other rounds, Stash has around 220, according to Axios.

“Though we've seen promising green shoots across many aspects of our platform, that growth hasn't materialized as quickly as we'd planned,” CEO Liza Landsman wrote in a note to employees.

The cuts will allow Stash, which earned $104 million last year, to hit cash-flow break-even this year rather than next year, Landsman told Axios.

It will also remove pressure to launch additional products while waiting for its already-out products to gain traction, she told Axios.

Stash said it had about 1.5 million active subscribers, down from 2 million in 2023. But the lower number was purposeful: servicing less-engaged accounts has cost Stash more than the revenue those accounts brought in. So, according to Axios, Stash migrated them off the platform.

Melio, a bill-paying fintech for businesses, let go of roughly 40 employees as part of an organizational restructuring, according to CTech.

Most affected employees were based in Israel, where the company is headquartered.

Melio, which raised $250 million at a $4 billion valuation in 2021, fell victim to its own growth, according to CEO Matan Bar.

“This is a difficult day for us. Accelerated growth as we have experienced in recent years is welcome, but it is the management's responsibility to examine all the time whether the organizational structure that has worked so far will serve us well for our goals in the future as well,” he said, according to CTech.

“In our case, we are forced to make a difficult but necessary decision, and unfortunately, as a result of the structural change, we also have to say goodbye to employees,” Bar said. “At the same time, there is no change in our goals for 2024, and we are convinced that this year, as every year, we will meet our ambitious goals.”

The firm continues to plan to grow, he said, “but we won't be able to realize [growth] if we don't take responsibility for our efficiency and organizational focus.

“Again and again, we are included in the lists of promising companies in the global fintech market,” Bar said. “Our responsibility is to realize this promise."

Banking-as-a-service platform Treasury Prime laid off about half of its nearly 100 employees, CEO Chris Dean confirmed.

Treasury Prime laid off teams focused on selling its products to other fintechs, including marketing, as a result of a strategic pivot that will, from now on, have the company focusing its sales efforts exclusively on banks. 

The firm has historically marketed itself to fintechs, then connected the fintech with a banking partner that would use Treasury Prime’s platform. However, Dean said the “interesting activity,” for the past six months or more, has been on the bank-direct side, and banks have wanted more to negotiate and ink deals with fintechs directly than with Treasury Prime as the liaison.

“If that’s where the puck is going, let’s just go there right now,” Dean said, confirming a development initially reported by Jason Mikula, publisher of Fintech Business Weekly, on LinkedIn.

Treasury Prime is, first and foremost, a software company, he said, and the intention early on was that banks on its platform would find their own fintech partners.

“[But] the volume of fintechs that wanted to talk to the banks was far more than the banks could deal with, so they asked us to help and we ended up building out a whole go-to-market team for years to support that. We get lumped [into a category of middlemen], though we really don’t think of ourselves like that,” Dean said.

“And at some point [in the] last six months, we realized that what we wanted to do when we started, finally, both the regulatory environment and the banks have caught up to that. So let’s just do that directly. It’s better business. It’s better for the banks, it’s better for the fintechs, the regulators like it better, it’s better all around,” he said.

The layoffs came one year after a $40 million Series C round, which followed a year of triple-digit growth.

The 40 to 50 employees affected by the layoffs have received “healthy severance,” Dean said, adding that cutting staff was “like a body blow.”

“But if you look at from the business side of like, ‘Oh, dang, this is what everyone wants to do anyway, and this is where we make all our money. Why don’t we just do it that directly?’ Everyone’s asking me [if] we’re gonna run out of money. No, we have years of runway. This is not the issue here,” Dean said. “We’re just trying to reflect what the reality of the world is. When the problem changes, the answer changes, and the problem has changed the past few years.”

Buy now, pay later provider Affirm cut about 140 jobs in February, as installment lending companies pursue operational efficiency in their quest to post profits.

The cuts, which affected about 6% of the company’s workforce, were the result of consolidation of several operations teams, an Affirm spokesperson said. “We are working individually with impacted Affirmers to assist them with their transition,” the spokesperson told Payments Dive.

About 60 workers in Pennsylvania were affected by the cuts. Affirm employees were notified Feb. 13 and most of those being cut were let go Feb. 15, according to the Feb. 13 Worker Adjustment and Retraining Notification Affirm sent to the Pennsylvania Department of Labor and Industry. 

Affirm allows remote work, but has offices in Chicago, New York, Pittsburgh and Toronto, in addition to its San Francisco headquarters. As of June 30, 2023, Affirm had about 2,171 employees, mainly in the U.S., according to its 2023 annual filing with the Securities and Exchange Commission.

Some details for the workers in Pennsylvania were provided. “A small portion of the affected employees will have a separation date on or before April 30, 2024,” Barb Cadigan, Affirm’s chief people officer, wrote to the Pennsylvania state agency in the letter.

The dates laid out in the letter applied to the broader group of employees Affirm let go, the spokesperson said. In February 2023, Affirm shed about 500 employees, or about 19% of its workforce at that time.

For its fiscal quarter that ended Dec. 31, Affirm’s loss narrowed, to $166.9 million, and its revenue jumped 48%, to $591 million, compared to the year-earlier period. The company’s forecast for the rest of the fiscal year was conservative, analysts said, despite revenue and merchandise volume jumping over the prior year during the holiday season.

As they mature, BNPL companies face growing pressure to generate profits. In a November report, Moody’s Investors Service painted a grim picture for installment lending companies, identifying competition, regulation, economic uncertainty and persistent losses as constraints on the sector.

Toast, the payments company that caters to restaurants, cut 550 employees, about 10% of its headcount, after a rapid expansion that proved unsustainable despite rising revenue.

“We’ve made the difficult, but right, decision to reduce our headcount by 10%,” Toast CEO Aman Narang told analysts on a call to discuss the company’s fourth-quarter earnings results. “As you know, Toast grew rapidly over the past few years to support a growing customer community. As I’ve taken a look across the organization, it has become clear that we grew our team too quickly in some areas, and we need to restructure the organization to best align with our most important priorities.”

Narang, a co-founder who took the top post in January after Chris Comparato stepped down last year, said the eliminated jobs were primarily not customer-facing. The company expects to complete its cost-cutting plan by the end of the year, according to an earnings release.

In addition to offering point-of-sale software services for restaurant clients, the company pitches related software services for online ordering, marketing, delivery, catering and other functions.

Despite the company’s growth, it’s still unprofitable, on a GAAP basis. For the fourth quarter, Toast narrowed its net loss to $36 million, from $99 million in the year-earlier period, according to the release. Still, it was wider than the $31 million net loss the company reported for the third quarter. For 2023, the company’s net loss narrowed to $246 million from $275 million.

Nonetheless, Toast’s gross profit and revenue are climbing. Fourth-quarter gross profit jumped 43% to $226 million from $158 million in the year-ago quarter, according to the release. Revenue for the fourth quarter rose 35% to $1.04 billion. 

As of the end of last year, Toast had a presence in 106,000 mainly U.S. restaurant locations, up about 7% from 99,000 at the end of the third quarter.

The employee pullback is expected to provide $100 million in annual savings, with about two-thirds included in the company’s forecast for 2024 guidance, analysts at the financial firm William Blair said in a note to investment clients.

“Toast announced a number of encouraging customer wins across the markets it serves, especially with enterprise customers, announcing it won Caribou Coffee (about 500 locations),” the note said.

Toast said it would absorb restructuring charges of as much as $55 million in the first quarter, mainly for employee severance expenses, according to the release.

Bill paying fintech BillGO planned to lay off 80 people at its Fort Collins, Colorado, office by March 31, The Coloradoan reported in February.

General counsel Gregory Cannon said the layoffs, which affected the company's Fort Collins headquarter as well as remote workers in 15 other states, were due to “a material change” in its business opportunities, according to a Worker Adjustment and Retraining Notification notice seen by The Coloradoan.

Most of those laid off were engineers.

San Francisco-based Block laid off around 1,000 people, or 10% of its staff, in January.

“We decided it would be better to do at once rather than arbitrarily space them out, which didn’t seem fair to the individuals or to the company,” CEO Jack Dorsey said in a note to Block staff published by Business Insider. “When we know we need to take an action, we want to take it immediately, rather than let things linger on forever.”

The layoffs affected employees within Block’s Cash App, Foundational and Square businesses. Operations overall were “getting leaner,” he wrote, according to Business Insider.

The cuts align with previous commentary from Dorsey, who, according to a separate Business Insider report, told employees last year to expect a 10% cut in headcount after its workforce grew faster than its business.

PayPal announced plans to cut about 2,500 jobs, or 9% of its workforce, in a letter CEO Alex Chriss sent to staff.

Chriss is trying to jump-start profitable expansion at the payments pioneer after it failed to meet growth goals in recent years. In a corporate announcement posted online, he said he had determined a workforce reduction was necessary. 

“Today, I am writing to share the difficult news that we will be reducing our global workforce by approximately 9% through both direct reductions and the elimination of open roles over the course of the year,” Chriss said in the web post. “We are doing this to right-size our business, allowing us to move with the speed needed to deliver for our customers and drive profitable growth.”

He added: “Specifically, across our organization, we need to drive more focus and efficiency, deploy automation, and consolidate our technology to reduce complexity and duplication.”

At the end of 2022, the San Jose, California-based company employed about 29,900 people globally, with 44% of those workers in the Americas, including 11,800 in the U.S., according to the company’s annual filing with the Securities and Exchange Commission last year. PayPal also had 43% of its workforce in the Asia-Pacific region and 13% in Europe and the Middle East.

“We submit this is a promising first step to driving profitable growth,” Gus Galá, an analyst with the financial firm Monness, Crespi, Hardt, said in a note to clients after the announcement was made.

Almost exactly a year prior, the company said it would eliminate about 2,000 jobs, about 7% of its workforce at that time.

Chriss, who took the top post from longtime leader Dan Schulman last September, had already shown that he’s willing to shrink the company in a bid to bolster profits. PayPal sold its Happy Returns business to shipper UPS for $465 million in cash in October, just two years after it acquired the business. 

In a November webcast with investment analysts, Chriss didn’t rule out additional divestitures. In that third-quarter earnings discussion with investment analysts, Chriss spelled out plans for reviving profitable growth at the company and said he walked into the role with “eyes wide open.” “There are clearly challenges to tackle,” he said at that time.

Brex cut 282 employees, now-sole CEO Pedro Franceschi told employees in an email and a post on the company blog.

The cuts are part of an effort to reduce layers of management and become profitable, Franceschi said.

As part of the management shuffle, Senior Vice President Camilla Morais replaced Michael Tannenbaum as chief operating officer. (Tannenbaum took a seat on the company’s board but later was hired to be Figure’s next CEO.) 

Meanwhile, Chief Technology Officer Cosmin Nicolaescu transitioned to an advisory role. Director James Reggio was promoted to vice president of engineering, the post said.

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.”

“Looking inward, I realized we grew our org too quickly,” Franceschi wrote, adding that the cuts and restructuring would put the company “on a clear path towards profitability and independence.”

The 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, according to The Wall Street Journal.