Figure Technologies, a blockchain startup co-founded by Mike Cagney, has recently announced a significant reduction in its workforce, amounting to 20 per cent of its employees. This decision comes at a time when the company has been reporting profitability and experiencing continuous revenue growth.
The rationale behind the layoff seems to be part of a strategic plan by the company to enhance its profitability and streamline operations ahead of the planned listing of its lending business in the early part of next year.
The company initially gained prominence by focusing on providing home equity lines of credit (HELOCs), a form of consumer credit that allows homeowners to borrow money against the equity in their homes. Over time, the startup expanded its product offerings to include digital currency payments and has forged partnerships with the USDF consortium to explore opportunities related to bank deposit tokens.
Despite the workforce reduction, Figure Technologies has demonstrated commendable performance in the HELOC market. Its Provenance blockchain, which ensures secure recording of mortgage transactions, has played a vital role in the company’s success in this sector.
The decision to cut staff raises questions, given the company’s current financial success. It is important to note that restructuring and layoffs are not uncommon in the startup world. Companies often undertake such measures to optimise operations, improve efficiency, and increase profitability before going public or undergoing significant business transformations.
As the company prepares for the listing of its lending business, stakeholders will be closely monitoring how this layoff impacts Figure Technologies’ overall operations, organisational structure, and long-term growth prospects.