Open banking platform Plaid is to lay off 20% of its workforce in response to the turbulent economic environment.
Like other fintechs feeling the pinch, Plaid hired agressively in the wake of the Covid pandemic as more businesses and consumers moved online.
That growth trend went into reverse as macroeconmic factors kicked in and users experienced slower than expected growth.
In a post on the Plaid wesbite, CEO and co-founder Zach Perret says: “The simple reality is that due to these macroeconomic changes, our pace of cost growth outstripped our pace of revenue growth. I made the decision to hire and invest ahead of revenue growth, and the current economic slowdown has meant that this revenue growth did not materialize as quickly as expected.”
All 260 affected employees were instantly locked out of Plaid systems in a move that Perret acknowledged may seem “abrupt” but that he deemed necessary “given the sensitive nature of data” consumed by the vendor.
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