Strip cuts 14 percent of workforce, CEO says ‘we’re overhired in the world we’re in’ • TechCrunch


Stripe has announced it will lay off 14% of its workforce, affecting around 1,120 of the fintech giant’s 8,000 workforce.

The latest strike follows a number of layoffs in the fintech sphere, with Brax shedding 11% of its workforce last month and Chim yesterday confirming 12% of its workforce would be laid off.

In a memo published online, Stripe CEO Patrick Collison relayed a familiar narrative in terms of the reasons behind the latest cuts: a major hiring drive spurred by the pandemic-induced e-commerce boom, a period of high growth, and then an economic downturn. Along with inflation, high interest rates and other macroeconomic challenges.

“We’re overworked in the world we’re in,” Collison wrote, “and it hurts that we can’t deliver the experience we want the people impacted by Stripe to have.”

While there is no perfect way to handle such a large-scale round of layoffs, Collison’s announcement is notable for accepting responsibility for the situation by pointing out two specific mistakes the company’s leadership made. wrote:

You might wonder if Strip’s management made some errors of judgment in making these changes. We’ll go further than that. In our view, we made two very important mistakes, and we want to highlight them here because they are important.

In the year We were very optimistic about the recent growth of the Internet economy in 2022 and 2023 and underestimated the possibility and impact of a broader slowdown.

We have rapidly increased operating costs. With the success we’re seeing in some of the new product areas, we’ve allowed coordination costs to grow and operational efficiencies to be introduced.

Today’s announcement probably won’t come as much of a surprise. While Stripe’s long-awaited IPO remains on balance, its own internal valuation is said to have fallen 28 percent to $74 billion from last year’s $95 billion. And in August, TechCrunch learned of a small layoff at Stripe, affecting a reported 45-55 employees at TaxJar, a tax compliance startup it acquired last year.

In terms of severance, Collison announced that all those affected will be paid 14 weeks, based on their time with the company. In addition, Stripe said it will pay each employee their full 2022 annual bonus regardless of when they leave, although it is pre-rated if they only come in this year. In addition, all unused paid time off (PTO) will be paid out and Stripe will provide six months of health care coverage after each departure.



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