Israeli insurtech company Next Insurance has announced that it is laying off 17% of its workforce. The company, which sells digital insurance services to small businesses, has an estimated workforce of over 800, meaning it is laying off 140-150 employees, including 40 in Israel.
Publicly traded insurtech companies, like Israeli company Lemonade and Hippo, have seen their market caps plunge this year because even though they are growing fast, they are not yet profitable. The economic slowdown has also hit harder tech companies that provide products to end consumers and small businesses in such fields as fintech, smart transport and e-commerce.
According to PitchBook, Next Insurance has raised large sums of money, including $250 million in its most recent financing round in March 2021, at a company valuation of $4 billion, double the valuation at its previous financing round in September 2020. The company was founded in 2016 by CEO Guy Goldstein, CTO Alon Huri, and VP R&D Nissim Tapiro.
Next Insurance said, "This has been a very difficult decision but we are reducing our workforce in order to adapt to the worsening macroeconomic environment. Over the past six years, since we were founded, we have invested a great deal in building the base of our product, and in enlarging customer recruitment channels. In 2021 we tripled our business activities and the company is on the way to expected annual revenue of $800 million in 2022. However, regarding our long-term vision the company is focused on the shift to profitability. We must cut our work force by 17%, with most of the jobs influence by this in the US."
Published by Globes, Israel business news - en.globes.co.il - on July 7, 2022.
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