Logistics software start-up Flexport is slashing 20% of its workforce as the San Francisco-based company looks to restore profitability.
Returning founder and now chief executive Ryan Petersen confirmed the job losses, which are thought to affect around 600 people, in a blog post on the company’s website.
The first job losses were due to be implemented on 13 October, the company confirmed.
“Over the last month, my leadership team and I evaluated every role in the company and its relationship to solving important supply chain problems for our customers,” he said.
“As a result, we are confident that this reduction in force will not impact the customer experience we provide to our customers today.
“With more than $1bn in net cash, following this change, Flexport is now in a great position to take advantage of the opportunities in front of us to return to profitability as soon as the end of next year,” he added.
Petersen returned to lead Flexport in early September after chief executive Dave Clark quit the company for reasons still to be disclosed.
Since his return, Petersen said he has “spoken to more than 100 of our top customers in my first month back as CEO and hopes to talk to hundreds more in the months to come”.
He said it is clear that Flexport’s customers “want us to be a profitable company they can rely on to solve important problems in their supply chain”.
“With today’s change, we’ll be able to get back to profitability without raising prices or placing our fortress balance sheet at risk,” he insisted.
“Instead, our path to profitability runs through delivering outstanding global logistics and technology solutions that solve customer problems.”
Several senior executives left the company in the wake of Clark’s sudden departure, while Flexport also rescinded job offers to employees due to join the company.
Clark, who joined from Amazon, said on X, the social media site formally known as Twitter, that “founders have the right to change their mind”.
“I came to Flexport to do big things, and that’s where I believe we were headed. Today, Ryan and I discussed his desire to return to focusing on growth in the core freight business.
“In light of that, I feel that he is best suited to lead the company in that direction. As such, I will be resigning from my position at Flexport,” he added.
Flexport is one of the most prominent start-ups in the US, having raised more than $2bn in funding and notched a valuation of $8bn.