Wefox CEO ‘disgusted’ by mass tech layoffs: ‘These are people’

HELSINKI, Finland — The boss of European digital insurance coverage startup Wefox provided a damning response to tech corporations which have laid off employees en masse.

The likes of Meta, Amazon and Twitter have laid off tens of hundreds of workers in response to stress from traders, who wish to see them reduce prices to climate a worldwide financial downturn.

Swedish fintech agency Klarna was among the many first main employers in tech to slash jobs this 12 months, reducing 10% of its workforce in Might. A number of corporations have adopted swimsuit, from these in Huge Tech to venture-backed startups like Stripe.

Julian Teicke, CEO of Wefox, informed CNBC he’s “disgusted” by what he views as a disregard by a few of his friends for his or her workers.

“I am somewhat disgusted by statements like, ‘by no means miss an excellent disaster’ [or] ‘now we have to chop the fats,'” Teicke mentioned in an interview on the sidelines of Slush, a startup convention in Helsinki, Finland.

Enterprise capitalists have been advising startups of their portfolios to chop prices and freeze hiring as economists warn of an impending recession.

Following a bumper 2021 filled with IPOs and mega funding rounds, a number of the most beneficial startups in Europe laid off vital numbers of workers and drastically scaled again their growth plans.

Initially of Slush on Thursday, Sequoia Capital companion Doug Leone informed founders and traders they need to embrace alternatives introduced by challenges within the broader financial system.

Forecasting a chronic recession worse than the 2008 or 2000 crises, Leone mentioned some corporations will emerge stronger than others. 

“You’ve gotten an incredible alternative in entrance of you, should you play your playing cards proper,” he mentioned. “You’ve gotten a possibility to move 10 vehicles. Don’t waste an excellent recession.”

In some eyebrow-raising feedback, Sebastian Siemiatkowski, CEO of Klarna, mentioned his agency was “fortunate” to chop jobs when it did. Siemiatkowski mentioned that roughly 90% of the folks laid off had since discovered new jobs.

“If we might have completed that right this moment, that in all probability sadly wouldn’t have been the case,” Siemiatkowski informed CNBC in an interview.

With out naming names, Teicke slammed the tech business over its method to mass redundancies.

“These are those that have possibly give up different jobs to hitch your enterprise. These are those that have possibly moved to different locations due to you. These are those that have possibly ended romantic relationships.”

Teicke mentioned managers have a accountability to guard their workers.

“I consider that CEOs should do all the pieces of their energy to guard their workers,” he mentioned. “I have not seen that within the tech business. And I am disgusted by that.”

“These are people,” he added.

Wefox is a Berlin, Germany-based agency that connects customers looking for insurance coverage with brokers and companion insurers by way of a web-based platform. The corporate was valued by traders at $4.5 billion in a July funding spherical.

Wefox says its enterprise is “crisis-resistant.” However fellow insurtechs have needed to make cuts recently, together with Lemonade, which shed 20% of workers at Metromile, a automobile insurance coverage firm it acquired, in July.

Requested whether or not his personal agency must make redundancies in response to shifting investor sentiment, Teicke mentioned his agency was “cautious” concerning the macroeconomic setting however had no plans for mass layoffs.

“I do not consider in mass layoffs,” Teicke mentioned. “We will give attention to efficiency, however not on mass layoffs.” Wefox is “very shut” to attaining profitability subsequent 12 months, he added.