Founder and CEO at controversial logistics startup Flexport, Ryan Petersen, has turned up the heat on his so-called ‘clean-up’ campaign after he got rid of his co-CEO Dave Clark.
It has now emerged that Petersen reduced the staff by 20% last week. He shared a copy of the letter on the company website.
The layoffs entailed different severance packages for staff based on their location. It has vowed to have a dedicated team of recruiters to help the departed staff find new employment.
No unexpected move
The reductions come as no surprise, with word traveling for over a week now that there would be lay-offs. However, the expectation was much higher, at 30%.
This is the second time the company has cut down on staff this year alone. The move was expected by many, given the current state of Flexport.
ALSO READ: Former Flexport CEO Dave Clark hits back
Axed Clark had a strong vision, which he shared with the company, to “heavily invest in hiring hundreds of software engineers”. A group of engineers were about to join the company when the turmoil started, introducing Clark’s exit and leaving new staff out to dry. A few hours before the new employees were supposed to join the team, Petersen ungraciously used X (formerly known as Twitter) to let them know their signed offer had been made null and void. He simply announced it: “I am deeply sorry to those people who were expecting to join our company and won’t be able to at this time.”
Why did the staff cut?
In his letter to employees, Petersen says: “Customers need to be able to count on Flexport as a reliable partner for their supply chain.”
“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. As a result, we are confident that this reduction in force will not impact the customer experience we provide to our customers today,” he assured everyone.
Petersen has labeled the reason for the second layoff in one year as a step he has to take to get “back to profitability without raising prices.”
He says with more than $1 billion in net cash, Flexport is now in a “great position” to return to profitability as soon as the end of next year.
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Mia is a multi-award-winning journalist. She has more than 14 years of experience in mainstream media. She's covered many historic moments that happened in Africa and internationally. She has a strong focus on human interest stories, to bring her readers and viewers closer to the topics at hand.
