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 corporations which have laid off employees en masse.

The likes of Meta, Amazon and Twitter have laid off tens of hundreds of staff in response to stress from buyers, who need to see them minimize 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 May. Several corporations have adopted go well with, from these in Big Tech to venture-backed startups like Stripe.

Julian Teicke, CEO of Wefox, advised CNBC he’s "disgusted" by what he views as a disregard by a few of his friends for his or her staff.

"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.

Venture 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, among the Most worthy startups in Europe laid off important numbers of workers and drastically scaled again their growth plans.

At the beginning of Slush on Thursday, Sequoia Capital accomplice Doug Leone advised founders and buyers they need to embrace alternatives introduced by challenges within the broader economic system.

watch nowAmazon CEO says layoffs will proceed into 2023Closing Bell: Overtime

Forecasting a chronic recession worse than the 2008 or 2000 crises, Leone mentioned some corporations 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 individuals laid off had since discovered new jobs.

"If we would have done that today, that probably unfortunately would not have been the case," Siemiatkowski advised CNBC in an interview.

Without naming names, Teicke slammed the tech business over its strategy 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 duty to guard their staff.

"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 looking for insurance coverage with brokers and accomplice insurers via a web based platform. The firm was valued by buyers at $4.5 billion in a July funding spherical.

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

Asked 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 atmosphere 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.

watch nowWefox founder explains the chance in digital insurance coverage industrySquawk Box Asia

primarily based on web site supplies www.cnbc.com

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