Financial services and technology company Brex laid off 282 employees, about 20 percent of its workforce, and restructured its management organization on Tuesday as it seeks to “increase the intensity and quality of our execution,” founder and co-CEO Pedro Franceschi said in a memo to employees.
In the memo, first reported by The Information, Franceschi said the aim is to build “a high-velocity product and growth machine” that requires the reductions. Brex launched as a corporate card product in 2017 and has expanded to a broader spend management platform, including a travel booking service launched in partnership with Spotnana last year. Brex currently serves “tens of thousands of businesses,” including “one in every three startups in the US,” Franceschi said in the memo.
“Looking inward, I realized we grew our org too quickly, making it harder to move at the speed we once did,” according to Franceschi. “This year, we decided to take a hard look at our current structure and reduce the number of layers between leaders and the actual work that affects customers. This resulted in today’s hard decision.”
Among the leadership changes, COO Michael Tannenbaum will leave that role and join the Brex board, with SVP of global operations Camilla Morais stepping up to the COO position. Chief technology officer Cosmin Nicolaescu will move to an advisory role this summer, and engineering director James Reggio will be promoted to VP of engineering. Both Reggio and Morais will report directly to Franceschi.
The latest layoffs come after Brex laid off 136 people, or about 11 percent of its staff at the time, last October, according to TechCrunch.
The memo indicated that Brex grew gross profit by 75 percent last year but “we still have a way to go to ensure high-velocity growth and profitability for years to come,” Franceschi said in the memo. “Combined, these changes enable us to get there and become cash flow positive with the money we have in the bank.”
