Pagaya Layoff 20% Staff To Save Annual $30M
Obviously, the layoff season is still upon us. Between late 2022 and the 3rd week in January 2023, a significant amount of tech employees have lost their jobs, as startups either shut down or cut down on staff.
Just in the 1st month of 2023, about 122 startups have laid off a total of 37526 employees, according to Layoffs.fyi reports. This seems to be the trend as every week has since had a layoff story.
One of the issues that keep this trend on the mind of everyone in tech is that no one is excluded. From America to Africa and Fintech to Foodtech every sector has been touched by the layoff wand.
Israeli Fintech AI startup Pagaya has laid off 20% of its employees to join the wagon. Pagaya is one of Israel’s leading Fintech startups and was shortly Israel’s highest-valued startup at the time in 2022.
Laying off a total of 140 employees, the Fintech startup revealed the layoff was a method for it to cut back on cost while possessing the ability to save about $30 million a year. The majority of the employees laid off, about 110 of them are based in Israel while the remaining 30 reside in the U.S.
Launched in 2016, the Israel Fintech startup, Pagaya Technologies, functions as a Fintech startup that develops and incorporates Artificial Intelligence (Al), Machine learning, and Data Science into its activities. With a customer base of Fintech startups with a lending profile, Pagaya customers are able to maximize its AI tools that provide customer credit assessment using real-time data analysis. The startup also functions as an asset financer.
While addressing the layoff, Gal Krubiner, Pagaya’s CEO and co-founder stated “Even though this is a difficult decision, we believe these changes will allow us to remain nimble and growth-focused.”
He further said “I would like to express my sincere thanks to the employees affected by this. We wouldn’t be where we are today without their dedication and hard work to promote our mission.”
If Pagaya’s calculation is right, the $30 million saved per year should help the startup regain its previous valuation soon.
In the early part of August 2022, Pagaya was listed as the highest-valued startup in the nation with a market tag of $ 20 billion. This is as its stock surge hit a record high. Unfortunately, the value could not be sustained as it dropped to about $680 million within 4 months. This devaluation created a 95% loss for the Fintech startup, hence a layoff.