Dive Brief:
- Chicago-based banking technology provider Amount has cut 18% of its workforce, a spokesperson for the company said Monday. With its acquisition of fintech Linear earlier this year, Amount had become a 600-person team, CEO Adam Hughes said during a May interview, meaning about 108 employees were cut.
- “Due to the current macroeconomic environment, we have decided to take some proactive adjustments to ensure Amount’s ability to thrive for years to come,” Hughes said in a statement on the layoffs. “We believe these actions are the prudent thing to do for the long-term health of the company and remain extremely excited about the future.”
- The company had about 600 employees as of last month, with offices in Chicago, Los Angeles, Virginia and New York City, Hughes said in a May interview.
Dive Insight:
Amount joins PayPal, Klarna, Bolt and Coinbase in cutting jobs in recent months as payments and fintech companies face macroeconomic pressures. Higher inflation and interest rates have been coupled with a drop in stock market valuations, causing venture capitalists to tighten their purse strings.
Swedish buy now-pay later provider Klarna cut about 700 workers last month. San Francisco-based checkout startup Bolt cut about a third of its workforce, or 250 employees, according to a Bloomberg report.
Amount, which has received $289 million in venture funding, was originally an offshoot of direct-to-consumer lending platform Avant. In 2020, it was spun out and rebranded as Amount. The company raised almost $100 million in 2021, giving it a valuation of $1 billion.
The spokesperson for the company said Amount was not closing any offices as part of the reduction, and would not comment on the types of jobs being cut.
As banks have sought to digitize their offerings, Amount has provided the technology that powers the digital side of traditional bank branch products like personal loans and credit cards, as well as facilitating buy now-pay later financing for banks.
Amount’s clients include financial institutions collectively managing more than $3 trillion in U.S. assets. It has about 24 direct partnerships with banks as well as partnerships with payments companies such as Mastercard and Fidelity National Information Services, Hughes said in May.
In February, Amount bought Reston, Virginia-based Linear, a small and mid-size business loan and account origination platform. Amount purchased Linear for $175 million in cash and stock, took on its 190 employees and renamed that arm of the operation Amount Small Business.
In May, Hughes had said Amount was well-capitalized, with “a ton of runway.” The company’s “core priority” in the first half of the year was ensuring its small business integration was “a home run,” he said. Management was “definitely eyeing” more acquisitions and expected to be “proactive” in the second half of the year, Hughes said at the time.
“The market is a bit turbulent right now, and so we feel really fortunate that we have great investors,” Hughes said in May.
At that time, Hughes said a public exit wasn’t in the plans this year for Amount, but the startup aimed to continue “to make progress on the product roadmap” and add partnerships. That focus would give the company “some nice optionality, whether it’s a public exit or a really attractive acquisition target for someone,” he said in May.
The spokesperson said Monday that the company’s priority “remains the same, which is executing smart strategies that promote top line growth, rapid innovation and unlock value” for its bank partners.
