Fintech startups have been pulling in superlatives across the board for the last several years. In 2021, these innovative companies garnered a great deal of attention among investors, raising more than $130 billion in venture capital fundraises in nearly 5,000 deals.
With the market trending downward, those companies that were once at the crest of a wave are now poised to fall the furthest. In more than 41 high-profile layoff events in the second quarter of 2022—only a fraction of all layoffs that actually occurred across the sector, industry experts assert—fintech startups laid off more than 3,700 people, more than 10% of all layoffs in Q2.
Critically, this figure excludes crypto firms; even at the reduced number following this omission, that still represents a massive increase from previous years, and is leaps and bounds ahead of other industries at the moment. And although major fintechs like Robinhood and Klarna are posting the largest layoffs by number of employees, it’s important to remember that even small startups have been making cuts to their workforce.
Of course, layoffs aren’t necessarily the end of the road for these embattled fintech outfits. Latitud Co-Founder Brian Requarth sounded a note of compassion to help guide his peers through this difficult time, posting: “Layoffs are hard and I don’t want to diminish that, but most likely the talent will get redistributed quickly. If you had to let people go, the most important thing is to treat those people well.”