- SoftBank-backed companies are laying off thousands of employees globally as they struggle to find paths to profitability.
- In the first full week of 2020, four companies – Oyo, Rappi, Getaround, and Zume – laid off a combined 2,600 employees.
- In the last year, other SoftBank-backed companies including WeWork, Uber, Wag, and Fair have also cut their ranks dramatically.
- SoftBank also saw significant executive turnover in the beginning of the year.
- If you work at a SoftBank-backed company, Business Insider wants to hear from you. Get in touch on secure messaging app Signal using a non-work phone: 646 768 1627.
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Flush with billions of SoftBank dollars, startups ranging from a robot pizza maker to a low-cost hotel operator have swelled their ranks in recent years.
Now, as the Japanese investor faces a reckoning about how the companies will become profitable, layoffs are hitting the companies across the world, and even affecting the investor itself.
In the first full week of 2020, four of SoftBank's companies cut a combined 2,600 employees, according to media reports from Business Insider and other outlets. More layoffs would come in the following months, bringing the 2020 cuts – not including furloughs – to more than 16,800.
Those layoffs follow major cuts in the fourth quarter at companies including WeWork, Uber, Wag, and Fair. In total, SoftBank-backed companies have cut at least 18,000 jobs in the last year, by Business Insider's count.
Because SoftBank's portfolio is global, with various reporting requirements by location and differing degrees of transparency, that number is likely a vast undercount.
That figure doesn't include groups of employees like WeWork's 1,000 janitorial staff in the US and Canada who are being outsourced. Trouble at these companies has knock-on effects since many work with contractors, such as the people that walk dogs for Wag, who enjoy fewer labor protections than full-time employees.
See more: Masa Son is facing one of his biggest challenges yet as the SoftBank Vision Fund racks up billions in losses. 12 insiders reveal where it all went wrong.
In the wake of major losses, SoftBank is thinking more about portfolio companies' path to profitability. Ahead of investing in Alto Pharmacy through its second mega-fund, SoftBank emphasized profitability in its due diligence process, CEO Matt Gamache-Asselin told Business Insider in early February.
"Really from the beginning, I was surprised by the level of depth and rigor that got put on profitability and economics," he said.
A SoftBank spokesman did not respond to requests for comment.
Business Insider is tracking the layoffs and what's happening at each company. The numbers are based on our own reporting as well as media reports elsewhere. We will continue to update this page as news evolves.
If you currently work for or were previously employed at a SoftBank-backed company and want to get in touch, use encrypted app Signal to text or call this reporter at 646 768 1627. You can also contact Business Insider securely via SecureDrop.
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Berlin-based travel startup Getyourguide lays off 90
Less than a year and a half after raising $500 million in a SoftBank-led funding round, Berlin-based travel startup Getyourguide has laid off about a sixth of its staff, or 90 people, German publication Gruenderszene reported in mid-October.
"As our view of the market's path to recovery has come into focus, it's become clear that it was necessary for us to adapt our company to the present reality," a Getyourguide representative told Reuters.
The travel company sells tours and activities across the world, from canal tours of Amsterdam to desert safaris in Dubai.
In March, Getyourguide co-founder and CEO Johannes Reck told Reuters that the coronavirus would cause a "nuclear winter" for the travel industry.
"Just survival over the next 12-24 months, by any travel company, will be a massive competitive advantage," he said.
Katerra cut more than 400 in late June after major cuts in 2019
Katerra, the modular construction company, laid off 400 people – 7% of its staff – in late June, The Information reported.
The company said the cuts, which were the fourth round of layoffs in three quarters, per The Information, would "accelerate our path to profitability."
In May, Katerra received more funding and said it would swap CEOs. SoftBank provided $200 million in May funding, which brought total capital raising to $2 billion, per the Wall Street Journal. Paal Kibsgaard, a former oil executive who was last Katerra's chief operating officer, became CEO.
Katerra in December it would shut down a factory in Phoenix, cutting about 200 jobs, Bloomberg reported.
In November, Katerra cofounder Fritz Wolff left the company, real estate publication The Real Deal said. Katerra has struggled with executive retention, with three CEOs and three CFOs in four years
And in October, The Information reported the company had cut more than 100 employees in three states.
Oyo laid off 700 US employees in 2020 and thousands globally
Discount hotel operator Oyo has cycled through furloughs and layoffs globally since January. In late June, the company told US staff that a large majority of furloughs would turn into layoffs, Business Insider reported.
The company had about 900 employees in the US at the start of 2019 and cut about 700 of them. In September, the company's new US head told Business Insider that Oyo would add headcount in 18-24 months.
The pandemic cuts extended worldwide. Oyo was preparing to cut 150-200 people in the UK, Yahoo reported on May 4.
The India-based company laid off sales and support staff in the US in two rounds of cuts in late January, Business Insider reported. The cuts totaled about 360 employees – one-third of its US total, the Skift later reported.
Before the US round of layoffs, Oyo cut 1,800 employees in China and India, Bloomberg reported. The company intends to lay off another 3,000 in China, Bloomberg said in March.
The restructuring isn't over: Oyo is planning to cut another 1,200 in India, Bloomberg reported.
"We continue to be one of the best places to work for and one of the key reasons for this has been our ability to consistently evaluate, reward and recognize the performance of individuals in a meritocratic manner, and enable them to improve their performance," Oyo said in a statement to Bloomberg.
The company lets people book hotel rooms in more than 80 countries through its app. It turns struggling local hotels into Oyo franchises, puts up some money to redecorate and make sure the wireless internet is working, and takes a cut on every booking.
Oyo has raised more than $3 billion in capital, though the last fundraise included $700 million from its young chief executive, Ritesh Agarwal. He bought back shares from existing investors Lightspeed Venture Partners and Sequoia Capital, as part of a deal that raised Oyo's valuation to $10 billion. SoftBank has been pumping money into the company since 2015.
Oyo used some of that money for staff expansion, much of it in India, per job postings analyzed by alternative data company Thinknum. In the US, the company has had fewer than 20 job postings since July and is now down to less than 10.
Globally, Oyo's job postings have dropped steeply in the last year, from August's high of 775 to 23 currently.
SoftBank Vision Fund cuts 80, including IPO readiness team
SoftBank's Vision Fund has seen a number of executive and staff changes in 2020.
In June, Bloomberg reported the fund would cut about 15% – or 80 people – of its global staff. SoftBank Group, meanwhile, cut 26 people.
Along with the layoffs, SoftBank wound down an "IPO readiness group" it started less than a year ago, Business Insider reported. The investor decided that having its portfolio companies outsource their IPO preparations would be more efficient than an in-house group, and the company cut the handful of people working on the effort, a person close to the firm told Business Insider.
In the first quarter, SoftBank had a number of executive departures in early February, and more could be on the way.
Michael Ronen, managing partner of the Vision Fund's US investments, left after expressing concerns about "issues" at SoftBank, the Financial Times reported. Ronen joined the company in 2017 after nearly 20 years at Goldman Sachs. At SoftBank, he led investments in transportation and logistics.
The day before the news about Ronen broke, Business Insider reported that Michelle Horn, SoftBank's chief people officer, departed.
Michelle Horn joined the Japanese investor in January 2019 after 23 years at McKinsey. When she started at SoftBank, she reported to CEO Masayoshi Son and Chief Operating Officer Marcelo Claure, who is also the chairman of WeWork. At SoftBank, she was one of the highest-ranking women.
More departures could come.
The FT reported that SoftBank is talking about veteran Ron Fisher's future. He championed the WeWork investment and has been close with Masayoshi Son for years.
SoftBank told the FT that Fisher was "a valued member of the SoftBank family" and was "not going anywhere."
Uber slashed more than 6,700 jobs in 2020
Uber, which went public in May 2019, cut 3,700 jobs in early May as the coronavirus ravages ride-hailing revenue. On May 18, the CEO said the company is laying off another 3,000 employees.
Uber's core ride business was down 80% in April, the Wall Street Journal reported.
The company had 28,600 global employees — 16,200 outside the United States – as of March 31.
The company went through three rounds of layoffs last year that saw the ride-hailing company shed more than 1,000 jobs. Those cuts hit about 400 people in marketing, 350 employees in its self-driving cars unit, and 435 staff in product and engineering.
Uber has been under tremendous pressure to reach profitability in the months since its IPO in May. Cost-cutting efforts like job cuts, as well as increased passenger fares, are part of that initiative, and Wall Street analysts have commended the moves so far. Shares of the company have plummeted 17% since going public.
SoftBank is Uber's biggest shareholder.
Builder.ai, formerly Engineer.ai, has laid off just under 14% of its workforce, largely in LA
Software development startup Builder.ai laid off almost 14% of its workforce in mid-May, Business Insider reported in early June.
The cuts accounted for 39 staff, most of which were in the company's Los Angeles office. A portion of UK staff were asked to take furlough.
Builder.ai, formerly called Engineer.ai, was founded by CEO Sachin Dev Duggal and cofounder Saurabh Dhoot. It was rebranded as Builder.ai in October 2019.
With offices in India, London, and Los Angeles, the company's flagship product is its Builder platform, which allows app developers who may not have the technical knowhow to build an app, or the funds to hire a team of engineers, to build one.
The company announced the layoffs due to the economic downturn brought on by the coronavirus pandemic on May 14 over a company Zoom call.
Builder.ai (then Engineer.ai) raised $29.5 million in its first round of funding in late 2018, attracting backing from Lakestar Ventures, Jungle Ventures, and SoftBank's AI-focused Deepcore fund.
Cruise cuts about 150 less than a year after $2.25 billion SoftBank investment
Cruise, the self-driving car firm owned by General Motors, is culling around 8% of its workforce, the company said in mid-May.
According to Bloomberg, which first reported the news, the move is aimed at cutting costs amid the ongoing coronavirus pandemic.
Cruise reportedly made the cuts across its recruiting, design, product, and business strategy teams. The number of workers culled totals around 150.
Last year, SoftBank invested $2.25 billion in the company in a deal that was cleared in July by a US national security panel.
WeWork cut at least hundreds of staff in May
Embattled office company WeWork cut at least hundreds of jobs in May in a month-long rollout of layoffs that have affected departments ranging from design to sales.
The cuts came before the company's membership dropped by 81,000 over the second quarter. WeWork's new c-suite has also seen two departures – chief financial officer and chief communications officer – since the team was put in place over the spring.
A company spokesman has repeatedly declined to specify the total number of jobs cut, which affected Europe too.
The spring cuts affected various departments and regions.
In New York, 314 employees were laid off, per a notice filed with the state in June. The May layoffs also hit the Flatiron School, WeWork's coding bootcamp, with 100 employees affected, largely in design and marketing, as the school winds down its design-focused programs. WeWork India cut 100 people, Reuters reported.
As part of the May overhaul, WeWork is restructuring its community team. Staff could choose between applying for jobs or facing dismissal, per documents leaked to Business Insider.
The major layoffs came after 250 employees were laid off in late March, unrelated to the coronavirus, per Bloomberg, and 74 were cut in San Francisco.
In November 2019, the company laid off 2,400 employees globally, about 20% of its workforce.
The company is outsourced about 1,000 cleaning staff in the US and Canada in a change planned months before its failed IPO. In mid-April, many of those outsourced cleaning staff were laid off by JLL.
See more: SoftBank's brutal treatment of WeWork founder Adam Neumann shows that it has given up any hope for Silicon Valley and it's leaving a scorched landscape in its wake
In early 2019, WeWork was privately valued at $47 billion, which made it the most valuable private startup in America. But filings for WeWork's highly anticipated IPO revealed wide losses and left prospective investors questioning the company's leadership and business model.
Now, it's valued at less than $3 billion, and investors are still marking their stakes down. Fidelity said it valued the coworking giant at 55% less at the end of July than what it did at the end of March.
SoftBank, one of WeWork's primary investors, ultimately offered a $9.5 billion package to acquire majority ownership of WeWork last year, giving former WeWork CEO and cofounder Adam Neumann a $1.7 billion deal in exchange for his departure – though the bulk of that package is now the subject of a lawsuit.
Read more: WeWork is rolling out more job cuts as the coronavirus deals the coworking giant a fresh setback. Here's everything we know about what's going on inside the company.
Klook lays off and furloughs more than 300 because of the pandemic
Hong Kong-based online travel agency Klook has laid off or furloughed more than 300 people because of the pandemic, Arival reported on April 21.
The company had more than 2,000 employees last year, per Arival.
In April 2019, Kook raised $425 million in a Series D funding round led by the Vision Fund. The company said at the time it would use the money to fund geographic expansions, including into Japan ahead of the Olympics, which have now been postponed because of the virus.
Brandless shuts down after 2019 staff cuts – Protocol
Brandless, the discount e-commerce platform, shut down in February after a tumultuous 2019 that saw a new CEO predicting profitability by 2021.
The company plans to lay off about 70 people – 90% of its staff – as it winds down operations.
The company's remaining 10 employees will work to fulfill its last customer orders and consider acquisition offers, according to Protocol, which first reported the news that Brandless would be shutting down.
Brandless launched in 2017 selling private-label household and personal care products at low prices. When it launched, almost everything on its site was $3. In October, Brandless said it was looking to start selling its products in major retailers' physical stores, signaling a shift in its online-only business model.
The business model changes came after a tumultuous year.
Brandless CEO Tina Sharkey stepped down in March and moved to co-chair of the board, reportedly amid tensions with SoftBank, per The Information.
Sharkey's role swap wasn't the only change at the discount e-commerce platform. Brandless cut 13% of its staff in March, per Forbes. The company struggled with inventory management and profitability when its items were all priced at $3.
After that, the company said it would expand into CBD, and Brandless's new CEO told Forbes in July that he thought the company could be profitable by 2021.
Brandless raised nearly $300 million, per Pitchbook, including a $240 million Series C in September 2018 led by SoftBank.
But Axios reported that its Series C was tranched. SoftBank put up $100 million, with a commitment to fund another $120 million depending on certain milestones. That second tranche never materialized.
Flexport lays off 50 after raising $1 billion from SoftBank – TechCrunch
Shipping company Flexport has cut 50 employees – 3% of its staff – TechCrunch reported in early February.
A company spokesperson told TechCrunch the cuts came as part of restructuring meant "to move faster and with greater clarity and purpose."
"We underinvested in areas that help us serve clients efficiently, and we over-invested in scaling our existing process when we actually needed to be agile and adaptable to best serve our clients, especially in a year of unprecedented volatility in global trade," the spokesperson told TechCrunch.
The logistics company raised $1 billion in February 2019 in a Series D round led by SoftBank. The funding round valued the company at $3.2 billion.
Zume cuts 360 employees and a third of its executive team
Zume, the robotic pizza startup valued at $1 billion, has cut most of its staff in 2020.
In April, the company let go all employees of Zume Forward, the beleaguered robotics and food-delivery-truck portion of the business, Business Insider reported.
About 200 employees were affected, and they will receive less than one months' severance as part of the separation agreement. The cuts represent two-thirds of Zume's employees after 360 staff were cut in January.
The cuts leave Zume — a company that was once valued by private investors at more than $1 billion with nearly 1,000 employees, including specialists in robotics and artificial intelligence — with about 100 staffers focused on a business creating compostable food packaging.
All told, the company had raised about $446 million and was valued between $1 billion and $2.2 billion after a $375 million funding infusion from SoftBank in November 2018. It has failed to raise substantial funding since and struggled to turn a profit since the company began.
Getaround lays off 150 – The Information
Car rental platform Getaround is laying off about 150 employees – a quarter of its staff – reported The Information.
SoftBank invested $300 million in the company's 2018 Series D round.
In a blog post on January 7, Getaround founder Sam Zaid said "growing this fast has also pressure-tested our organization."
"We've learned a lot about our business during this period and the importance of balancing growth with efficiency," he wrote. "SoftBank has stepped up in a big way with their unique network of experts, resources, and partners to support this change."
Getaround has raised a total of $612 million and has a $1.7 billion valuation, per Pitchbook.
Rappi cuts about 300 – Brazil Journal
The Latin American food delivery startup is cutting about 6% of its workforce, about 300 employees, according to the Brazil Journal in January 2020.
The cuts come less than a year after SoftBank led a $1 billion funding round.
"We are in fact actively hiring a large number of people in our areas of focus for 2020," the company said in a statement to Reuters.
"We are investing heavily in our tech team, automating some roles, re-balancing areas and embracing high performers," Rappi said, without noting how many employees it plans to add.
Cofounder Sebastian Meijia told Reuters his priority was to grow fast when the outlet asked how soon the company would become profitable.
The company has raised a total of $1.46 billion and has a $3.5 billion valuation, per Pitchbook.
Fair cut 300 employees in October
Fair, the short-term car rental platform for consumers and Uber drivers, cut about 300 employees in October 2019.
The layoffs came after a sudden SoftBank audit that led to the ouster of controversial CEO Scott Painter and his brother, the chief financial officer.
Business Insider talked to a dozen current and former employees in November who explained how the startup burned through nearly $400 million, largely from SoftBank, in 10 months, a cautionary tale of a startup on an explosive growth path.
SoftBank's rescue plan included an immediate $25 million infusion to keep the company afloat.
Wag laid off 182 employees and lost its CEO last year
Dogwalking startup Wag had a turbulent fourth quarter.
CEO Hilary Schneider left in late November to join photo-sharing company Shutterfly, and the company went through its second round of layoffs, bringing the total cuts in 2019 to 182 employees.
SoftBank also announced it would sell its nearly 50% stake back to the company, reportedly at a significant discount, and give up its two board seats.
SoftBank's Vision Fund first invested in the dog-walking startup early last year, pushing up the company's valuation to about $650 million. But the startup has struggled to compete, and Bloomberg reported in October that it was seeking to sell itself at a discount.
SoftBank's Masayoshi Son seemed to express concern about Wag in his latest investor presentation, as he referred to a dog-walking company as one of the Vision Fund's more troubled investments.
SoftBank's sale of its stake followed a disagreement within the company's board on its path to future profitability, one person familiar with the talks told Business Insider.
Wag had raised a total of $361 million, per Pitchbook.
Ola restructuring affected 350 employees, with some reassigned to other roles
In November, the Indian ridesharing company said it would restructure about 350 employees' jobs, with some employees moving to other roles, the Economic Times reported.
The company is still expanding, with plans to launch in London this month, per CNBC. Last year, Uber had its London license revoked by local authorities. Ola already operates in eight UK cities, and in Australia and New Zealand.
The company has raised $3.78 billion at a $4.44 billion valuation, per Pitchbook. SoftBank most recently led a $330 million funding round in February 2017.
Opendoor laid off 50 in July and reduced its free lunches – Bloomberg
Online homeseller Opendoor cut about 50 of its 1,300 staff in June 2019 – and stopped free lunches for small offices, Bloomberg reported.
The company also asked about 300 employees in offices across the country to relocate to its Phoenix office. Despite the layoffs, a spokeswoman said Opendoor planned to add 250 employees to the Phoenix office and will
The startup plans to double the number of employees in Phoenix to more than 500 next year, and will continue to hire in all of its markets, Bloomberg said.
Opendoor was last valued $3.8 billion, per Pitchbook.
Heed shut down in July – nine months after SoftBank invested, per Calcalist
Sports-focused artificial intelligence company Heed shut down in July 2019, Calcalist reported at the time.
The company, which had about 30 employees in the US and Israel, had last raised $35 million in an October 2018 funding round led by SoftBank.
Calcalist reported that some Heed staff were offered jobs with the founders' other companies.
Before it folded, Heed used artificial intelligence to review games and give insights to fans.
Light laid off half its staff this summer after pivoting to autonomous vehicles on Son's suggestion – Bloomberg
Light Labs Inc., a Redwood City, California-based camera startup, raised $121 million in a July 2018 Series D funding round led by SoftBank.
Masa Son recommended that Light pivot away from consumer photography, to autonomous cars, per Bloomberg.
After the pivot, Light cut about half its employees in July 2019, with Bloomberg reporting that the company "eliminated its original smartphone-camera technology to help stem losses." It's unclear how many employees were laid off.
Light raised $186 million in total and was valued at $396 million in July 2018, per Pitchbook.
Axel Springer, Insider Inc.’s parent company, is an investor in Uber.
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