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

HELSINKI, Finland — The boss of European digital insurance coverage startup Wefox supplied a damning response to tech corporations which have laid off staff 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 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 Could. A number of corporations have adopted go well with, from these in Massive 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 workers.

“I am slightly disgusted by statements like, ‘by no means miss an excellent disaster’ [or] ‘we’ve got to chop the fats,'” Teicke stated 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 beneficial startups in Europe laid off vital numbers of employees and drastically scaled again their enlargement plans.

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

Forecasting a protracted recession worse than the 2008 or 2000 crises, Leone stated some corporations will emerge stronger than others. 

“You have got an important alternative in entrance of you, if you happen to play your playing cards proper,” he stated. “You have got a possibility to go 10 automobiles. Don’t waste an excellent recession.”

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

“If we’d have accomplished that at this time, that in all probability sadly wouldn’t have been the case,” Siemiatkowski advised CNBC in an interview.

With out naming names, Teicke slammed the tech business over its method to mass redundancies.

“These are those that have perhaps stop different jobs to hitch what you are promoting. These are those that have perhaps moved to different locations due to you. These are those that have perhaps ended romantic relationships.”

Teicke stated managers have a duty to guard their workers.

“I imagine that CEOs should do every part of their energy to guard their workers,” he stated. “I have not seen that within the tech business. And I am disgusted by that.”

“These are people,” he added.

Wefox is a Berlin, Germany-based agency that connects customers in search of insurance coverage with brokers and associate insurers by way of an internet 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 currently, together with Lemonade, which shed 20% of employees at Metromile, a automobile insurance coverage firm it acquired, in July.

Requested whether or not his personal agency must make redundancies in response to shifting investor sentiment, Teicke stated his agency was “cautious” in regards to the macroeconomic setting however had no plans for mass layoffs.

“I do not imagine in mass layoffs,” Teicke stated. “We will deal with efficiency, however not on mass layoffs.” Wefox is “very shut” to attaining profitability subsequent yr, he added.