After a year when new, $1 billion companies and record venture capital raises dominated the headlines in Atlanta’s startup ecosystem, layoffs were the main story in 2022.
By the beginning of spring, investors shifted their focus from growth to profitability, resulting in a decrease of company valuations by as much as 70%. Companies don't tend to seek outside capital if their valuation declines from when they previously raised money. Some also opted to restructure their business to cut costs, which oftentimes meant layoffs. That trend is also happening on a national scale — Meta Platforms Inc., Intel Corp. and other major technology companies also announced hiring freezes or layoffs this year.
“The entire market has generally been put on pause in terms of dramatically higher valuations based on performance because of all this,” serial entrepreneur David Cummings told Atlanta Inno in April. “These are still great businesses, but I think we'll be in an 18 to 24 month drought of new unicorns.”
These are the Atlanta startups that laid off workers in 2022:
Cardlytics
The founders of Cardlytics resigned amid company layoffs that aim to reduce operating costs in November. Fifty-one employees were impacted, according to a filing with the U.S. Securities and Exchange Commission filing. The company expects the cuts will cost $1.1 million in severance payments and benefits. The layoffs are set to be complete in early 2023. Cardlytics, which was founded in 2008 and went public a decade later, works with businesses to deliver ads to specific consumers via banking sites. Co-founder and former CEO Lynn Laube is now working as an operating partner at seed-stage venture capital firm Valor Ventures.
Read the full story here.
FullStory
One of the Atlanta companies that became a unicorn in 2021 laid off around 12% of its staff just over a month after raising $24 million in August. FullStory Inc. made the layoffs to “align to the current macro environment and focus on long-term sustainable growth,” said a spokesperson in an email. Positions that were impacted were primarily in sales and recruiting functions. Atlanta Inno reported in August 2021 that the startup has approximately 300 employees. FullStory provides insights to companies into customers’ digital experiences by tracking and analyzing their activity on a website.
Read the full story here.
OneTrust
Atlanta data privacy and security company OneTrust LLC laid off a fourth of its workforce, according to a company announcement in June. The layoffs affected 950 employees. The company had more than 3,000 employees around the world, about 1,000 of whom are based in Atlanta. The company's suite of products helps companies protect client data, comply with privacy guidelines, evaluate risks and manage internal and external ethics and compliance. OneTrust started hiring again in November.
Read the full story here.
Sunday
Sunday, a financial technology startup for restaurants, reduced its team in response to constrictions in the market, CEO Christine de Wendel said in July. Those cuts also included refining its geographical and product focus — a new business model for the team. Sunday is narrowing its geographical focus to the U.S., United Kingdom and France before expanding into other markets. It’s also reducing product innovation efforts and instead focusing on its core offering.
Read the full story here.
Stord
Supply chain technology startup Stord, which grew into a $1.3 billion company in six years, laid off 59 people in July. The layoffs were across multiple units and “part of a routine review” of employees. Stord had more than 700 employees. A Stord spokesperson did not say the economic climate has affected the company and declined to comment further. Stord’s software helps mid-market businesses manage their deliveries.
Read the full story here.
Sonar Software
Sonar Software Inc. alerted staff of layoffs on May 23, according to three current and former employees who spoke to Atlanta Inno. According to one former employee that was impacted, approximately 40% of the company’s staff was laid-off. Sonar executives planned to grow its team from 25 employees in March 2021 to 75 employees by the start of 2022 following a $12 million investment round, according to previous Atlanta Inno reporting. It is unclear whether Sonar reached that goal before the layoffs. Sonar helps companies manage their tech stacks by giving product developers a blueprint for how software changes may affect other aspects of the company, such as sales and marketing teams.
Read the full story here.
Terminus
Atlanta startup Terminus confirmed it will be laying off "a small percentage" of employees a year after raising $90 million and garnering attention as a possible unicorn. The layoffs were part of a restructuring, a Terminus spokesperson confirmed to Atlanta Inno in May. It is unclear exactly how many employees were laid off. A LinkedIn post by a former employee stated that 15% of Terminus’ workforce are affected. In March of 2021, the company had 200 employees with plans of hiring an additional 50. Terminus helps companies target clients by providing a platform for account-based marketing.
Read the full story here.
Bakkt
Bakkt Holdings Inc. (NYSE: BKKT) informed employees that their jobs are impacted by a restructuring that it announced as part of its third quarter earnings, according to a company statement on Dec. 8. It made a 15% reduction across its exempt employee base in order to "navigate the challenging macroeconomic and crypto environments." Bakkt is a cryptocurrency and digital asset exchange platform. In November, Bakkt announced it will acquire crypto trading company Apex Crypto LLC from Apex Fintech Solutions for up to $200 million. Bakkt went public through a special purpose acquisition company deal in 2021.
Read more here.
