There has been an increasing number of tech companies that have enacted hiring freezes and layoffs.
Maju Kuruvilla, the CEO of Bolt, a fast-growing tech company offering one-click checkout, wrote in a corporate blog post that there will be layoffs. His statement danced around the topic, writing, “It’s no secret that the market conditions across our industry and the tech sector are changing, and against the macro challenges, we’ve been taking measures to adapt our business.”
Kuruvilla took over the reins from outspoken founder Ryan Breslow. He added, “In an effort to ensure Bolt owns its own destiny, the leadership team and I have made the decision to secure our financial position, extend our runway and reach profitability with the money we have already raised.” Translated from corporate-speak, Kuruvilla will lay off workers.
The New York Post reported that roughly “one-third of the company is being laid off,” which impacts about “130 U.S. and Canada staffers who were axed Wednesday, plus more than 100 European employees whose jobs will be eliminated in the coming days.”
I Know This Will Be Difficult
Kuruvilla said in the post, “I know this will be difficult for us all, so I want to provide clarity on what will happen next. For those directly impacted in the U.S. and Canada, our goal is to inform you within the next 30 minutes when you will receive a calendar invite for an individual or small sub-team ‘Bolt Restructuring’ meeting.”
Bolt is not alone in the downsizing. Klarna, a Sweden-based fintech company in the buy-now-pay-later space, announced plans to lay off about 10% of its global workforce, in a pre-recorded video message Monday.
The Tech Sector Is Enacting Hiring Freezes And Layoffs
There has been an increasing number of tech companies that have enacted hiring freezes and layoffs. Previously, Dara Khosrowshahi, CEO of Uber, told his team via email that he is tapping the brakes on adding a new headcount at the ridesharing app company. He perceived bringing aboard new people would be considered “a privilege” in light of the “seismic shift” in the economy and tech sector.
Meta stated that it would reduce hiring for mid-level and senior roles at the social media company, and mortgage startup Better.com, best known for the CEO who fired people via a oneway Zoom video and called employees “dumb dolphins,” laid off approximately 4,000 people.
Robinhood, the trading app that gained notoriety and popularity during the pandemic, as young novice investors stuck at home started aggressively trading meme stocks and cryptocurrencies, announced it will let go of around 9% of its workforce. The company dramatically increased its headcount from about 700 employees in 2019 to nearly 4,000 by 2021. CEO Vlad Tenev wrote about the layoffs, “While the decision to undertake this action wasn’t easy, it is a deliberate step to ensure we are able to continue delivering on our strategic goals and furthering our mission to democratize finance.”
Netflix provided pink slips on April 28 to the team at its Tudum fan-focused site. Netflix was another beneficiary of the stay-at-home era.
Breslow Can’t Help Causing Controversy
Breslow's penchant for speaking whatever’s on his mind has created some controversy. He drew attention and headlines back in January when he tweeted allegations against competitor Stripe and well-established Silicon Valley venture capitalists, including Sequoia and Y Combinator. He accused these and other entities of attempting to bring him down. After his tweetstorms abated, Breslow handed off the CEO title to Kuruvilla and became the chairman of Bolt’s board.
Allegations Against Bolt
A blistering New York Times investigation piece reported that Breslow allegedly over-inflated numbers, metrics and technological prowess to gain more customers and a higher valuation. The e-commerce startup skyrocketed to an astounding $11 billion valuation in January.
Bolt is now being sued by Authentic Brands Group, a large client that owns numerous brands, such as Lucky Brand and Forever 21. The company alleges that Bolt did not live up to their promises—to the detriment of the Authentic Brands.
Bolt has disputed the accusations. “We are committed to providing all of our customers with a great product and we are thankful for our wonderful partnership with Forever 21 and Lucky Brand, which continues to be strong,” Kuruvilla said in the statement. “Although we deny all of Authentic Brands Group’s allegations, it’s clear that ABG has confidence in Bolt as they are fighting to own significant equity in our business. We look forward to continuing to work closely with Forever 21 and Lucky Brand on delivering the best checkout experience for their shoppers.”
Be Mindful And Caring For Your Colleagues
Kuruvilla closed out his statement by stating, “There’s no good way to share news of a restructure, but it’s in our culture to be committed to candor and care, today and always. I can’t thank you enough for all of your past, present and future dedication to make Bolt what it is. We have an incredible team, great product and the market needs us more than ever before. But today, my focus is on our people. Please be mindful and caring for your colleagues and yourself.”
