San Francisco-based digital bank Varo has laid off 75 members of staff as it looks to restructure in the pursuit of profitability.
In an announcement on the bank’s website, CEO Colin Walsh says the firm is “not immune to the impacts of our current environment” and the job cuts were an “extremely tough decision” made to ensure Varo has sufficient capital to execute its strategy and “path to profitability”.
In addition to the job cuts, Varo has taken steps to decrease its burn rate, “including limiting hiring to the most critical roles and pulling back on marketing investments in the near-term”.
Those who no longer have a job at Varo will receive severance pay, extended benefits and other resources.
With the challenging economic conditions in mind, the bank has also set up a new business unit, Varo Tech.
This new division will bring together technology, design, data and product functions “under a single umbrella”, reducing silos and driving “cross-functional collaboration”.
“This new structure will allow us to increase pace, reduce costs, and, as always, ensure our focus remains on technology innovation and continuing to engage and grow our customer base,” Walsh says.
Despite the job cuts, Walsh says the bank is focused on making financial inclusion “a reality for all”.
“With inflation on the rise and market volatility increasing, I believe that our mission is more important than ever,” Walsh adds.