American companies Brex and MX have joined the long list of fintechs to announce staff cuts this year.
Brex lays off approximately 11% of its workforce
Pedro Franceschi, founder of Brex, cites the current macro environment and wanting to increase focus on the company’s strategy as reasons behind his firm’s decision to lay off 136 employees – approximately 11% of its total workforce.
In June, Brex announced that it will stop serving traditional small businesses and shift its focus to helping organisations scale with its new product offering Empower, which was launched in April.
“Late last year, we decided to sharpen our focus and serve fewer customers really well. Today’s change is a continuation of this,” Franceschi says, adding that Brex has been “laser-focused” on serving early-stage start-ups and scaled companies this year.
“While we’re fortunate to be in a strong financial position with many years of runway, the new macro environment is materially different from the first five years of Brex and warrants a new level of focus and financial discipline,” Franceschi adds.
“We know the importance that our customers place on Brex’s financial strength, and this change will put us on a path to sustainable profitability over the next few years.”
He adds that affected employees will be given severance pay, along with equity, healthcare and job search support.
Founded in 2018, Brex started off as a corporate card start-up. In January this year, it was valued at over $12 billion after raising an additional $300 million in a Series D extension.
Meanwhile, Utah-based MX has laid off an undisclosed number of employees in a reorganisation that it says will help the company “better deliver on our mission”. Writing on LinkedIn, the company has set up an opt-in list for impacted employees to share their details, which at time of writing includes 51 names.
Founded in 2010, MX makes use of open finance APIs and financial data to “quickly and securely” connect to and verify data for “hundreds” of use cases including account opening, money movement and underwriting.
The firms join companies including Klarna, TrueLayer, Xendit, Clearco, Robinhood, Varo and Wealthsimple in announcing staff cuts this year.
