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

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

The likes of Meta, Amazon and Twitter have laid off tens of 1000’s of workers in response to strain from buyers, 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 yr, slicing 10% of its workforce in Could. A number of firms have adopted swimsuit, from these in Massive 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’m a little disgusted by statements like, ‘never miss a good crisis’ [or] ‘we have to cut the fat,'” 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 stuffed with IPOs and mega funding rounds, a number of the most dear startups in Europe laid off important numbers of employees and drastically scaled again their enlargement plans.

In the beginning of Slush on Thursday, Sequoia Capital companion Doug Leone informed founders and buyers 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 firms will emerge stronger than others. 

“You have a great opportunity in front of you, if you play your cards right,” he mentioned. “You have an opportunity to pass 10 cars. Do not waste a good recession.”

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

“If we would have done that today, that probably unfortunately would not 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 people that have maybe quit other jobs to join your business. These are people that have maybe moved to other places because of you. These are people that have maybe ended romantic relationships.”

Teicke mentioned managers have a accountability to guard their workers.

“I believe that CEOs have to do everything in their power to protect their employees,” he mentioned. “I haven’t seen that in the tech industry. And I’m disgusted by that.”

“These are humans,” he added.

Wefox is a Berlin, Germany-based agency that connects customers in search of insurance coverage with brokers and companion insurers by way of a web-based platform. The corporate was valued by buyers 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 employees at Metromile, a automotive 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” in regards to the macroeconomic surroundings however had no plans for mass layoffs.

“I don’t believe in mass layoffs,” Teicke mentioned. “We’re going to focus on performance, but not on mass layoffs.” Wefox is “very close” to attaining profitability subsequent yr, he added.

Wefox founder explains the opportunity in digital insurance industry

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