London-based BNPL unicorn Zilch is preparing to axe up to ten percent of its workforce just months after securing an additional $50m in funding.
Zilch appeared to be bucking the donward trend in the bruised BNPL market, as incoming regulation and rising interest hit the valuations of competitors like Klarna.
A $50 million funding round in June took the total raise for Zilch's Series C to $160m, bringing its total funding to more than $460m in debt and equity. The raise was unusual for the sector as the firm maintained its valuation in a clearly distressed market.
The new wave of redundancies, first reported by London's Evening Standard, come as firm's prepare for the recession by curbing expansionary tendencies and focussing on bottom-line profitability.
Latest Companies House accounts for Zilch show it made a loss of £8.4 million on revenue of £700,000 for the year to March 2021.
A spokesperson for Zilch told the Standard: “In just 24 months since launch, Zilch has created over 250 new jobs, gained millions of customers at record speed and recently turned gross profitable.
“But in the last year the world has changed, and any business that thinks it’s immune to this historic economic change is mistaken. With millions of customers depending on us, we must continue to drive towards bottom-line profitability."
In a statement to Finextra, Zilch responds: “We are shifting our priorities from high growth towards even greater product development and innovation, and as part of this strategic shift in focus, we are planning to hire around 20 people into new positions alongside the ongoing collective consultation process for certain roles that have been placed at risk, resulting in a relatively small net adjustment to our total headcount.”
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