Stripe Cutting Headcount by 14% As It Readies for ‘Leaner Times’- 1000+ Jobs To Be Cut

    Stripe Inc., one of the world’s most valuable startups, will cut more than 1000 jobs as it seeks to rein in costs.
    By: BLOOMBERG
    | Updated on: Nov 04 2022, 00:55 IST
    Stripe
    Stripe and its publicly traded rivals have seen valuations drop as the growth in online spending slowed in the aftermath of the pandemic. (REUTERS)
    Stripe
    Stripe and its publicly traded rivals have seen valuations drop as the growth in online spending slowed in the aftermath of the pandemic. (REUTERS)

    Stripe Inc., one of the world's most valuable startups, will cut more than 1,000 jobs as it seeks to rein in costs ahead of any economic downturn.

    The payments company will cut its workforce by 14% this week, returning headcount to the almost 7,000 total from February, co-founders Patrick and John Collison said in an email to staff seen by Bloomberg News. The two vowed to trim expenses more broadly as they prepare for “leaner times.”

    “We were much too optimistic about the internet economy's near-term growth in 2022 and 2023 and underestimated both the likelihood and impact of a broader slowdown,” the Collison brothers said in the email. “We grew operating costs too quickly. Buoyed by the success we're seeing in some of our new product areas, we allowed coordination costs to grow and operational inefficiencies to seep in.”

    Stripe and its publicly traded rivals have seen valuations drop as the growth in online spending slowed in the aftermath of the pandemic, just as supply-chain disruptions and once-in-a-generation inflation also hurt activity. The company in July told staffers that an internal valuation for the company dropped to about $74 billion, compared to the $95 billion it received in its most recent fundraising.

    The Collisons said the headcount changes wouldn't evenly impact the business, noting that the recruiting business would be disproportionately impacted since the company plans to hire fewer people next year. Departing employees will receive at least 14 weeks of severance, and the brothers vowed to pay annual bonuses and unused paid time off for all workers affected by the cuts.

    “Stripe is not a discretionary service that customers turn off if budget is squeezed,” the Collisons said. “However, we do need to match the pace of our investments with the realities around us. Doing right by our users and our shareholders (including you) means embracing reality as it is.”

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    First Published Date: 04 Nov, 00:54 IST
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