Open banking fintech Plaid to cut 260 jobs
Open banking platform Plaid is laying off 260 employees as the firm adjusts to tougher macroeconomic conditions.
Plaid to cut 260 jobs
In a message to employees across the US, UK and Europe, Plaid CEO Zach Perret says that during the Covid pandemic, a “dramatic increase” in fintech adoption led to a sharp increase in usage by existing customers, “substantial revenue acceleration” and a large number of new customer signups. As a result, the firm hired “aggressively” and invested in new products to meet demand.
“Macroeconomic conditions have changed substantially this year,” says Perret. “Despite being well-diversified across every category of financial services, we are seeing customers across the industry experiencing slower-than-expected growth.
“The simple reality is that due to these macroeconomic changes, our pace of cost growth outstripped our pace of revenue growth.
“I made the decision to hire and invest ahead of revenue growth, and the current economic slowdown has meant that this revenue growth did not materialise as quickly as expected.”
Perret adds that while the decision to cut jobs was “incredibly tough”, the move is “necessary” to allow the firm to “continue to operate from a position of strength so we can best support our customers and the millions of consumers we jointly serve for the long-term”.
“People continue to need tools and services to manage their financial lives, and the financial industry will continue to move towards digital-first delivery,” Perret adds.
Plaid joins an ever-increasing list of companies to reduce the size of their workforce in recent times.
Fintech darling Stripe is cutting 1,100 jobs while Brex and MX announced layoffs in October, joining Indonesian fintech Xendit, BNPL giant Klarna, African challenger Kuda and Aussie crypto exchange Swyftx, among others.
