Robinhood lays off 23 percent of its staff, citing inflation
Financial services company Robinhood announced Tuesday it would be laying off 23 percent of its staff, citing inflation as one of the reasons for the move.
CEO and co-founder Vlad Tenev said in a message to all employees that the company would be reorganizing into a general manager structure, which would affect all roles but particularly operations, marketing and program management functions.
The reorganization “will flatten hierarchies, reduce cross-functional dependencies, and remove redundant roles and positions,” while around 23 percent of roles will get cut.
The statement cited inflation and the crypto market crash as two of the major reasons for the job cuts, as those issues have reduced customer activity on the platform.
The company cut 9 percent of jobs at the beginning of the year to combat costs at Robinhood, but the move “did not go far enough,” Tenev said.
“In this new environment, we are operating with more staffing than appropriate. As CEO, I approved and took responsibility for our ambitious staffing trajectory – this is on me,” Tenev said.
Tenev said the additional staffing in 2021 occurred because he believed the increased activity in the crypto and stock market from the pandemic would continue into 2022.
Employees who get laid off will be allowed to stay employed until the beginning of October and will be given cash severance, payment of COBRA medical, dental and vision insurance premiums, and job search assistance.
“We know that this news is tough for all Robinhoodies, and we are also offering wellness support to those who would like it,” Tenev said.
Robinhood’s announcement comes a week after Shopify said it was cutting 10 percent of its workforce.