WeFox CEO Julian Tick.
HELSINKI, Finland – The boss of European digital insurance startup Wefox has hit back at tech companies seeking to lay off mass workers.
Companies like Meta, Amazon and Twitter have laid off thousands of employees in response to pressure from investors who want them to cut costs as they weather the global economic downturn.
Swedish fintech company Klarna was one of the first major employers to cut jobs this year, cutting 10% in May. Many companies have followed suit, from Big Tech to venture-backed startups like Stripe.
Julian Ticke, CEO of WeFox, told CNBC that he is “disgusted” by the disregard for his employees by some of his colleagues.
“I am a bit disappointed by statements like: ‘Never miss a good crisis’ [or] “We need to cut the fat,” Tike said in an interview on the sidelines of Slush, a startup conference in Helsinki, Finland.
Venture capitalists are advising startups in their portfolios to cut costs and freeze hiring as economists warn of an impending recession.
After a year of IPOs and mega-funding rounds in 2021, some of Europe’s most valuable startups have cut back significant headcount and significantly scaled back their expansion plans.
At Slush’s launch on Thursday, Sequoia Capital partner Doug Lyons told founders and investors to embrace the opportunities presented by the challenges in the wider economy.
While predicting a recession worse than the 2008 or 2000 crisis, Leone said some companies will emerge stronger than others.
“You have a good chance if you play your cards right,” he said. “You have the ability to pass 10 cars. Don’t waste a good delay.”
In comments that raised some eyebrows, Sebastian Siemiatkowski, CEO of Klarna, said his company was “happy” when it cut jobs. Siemiatkowski said about 90% of those laid off have since found a new job.
“Unfortunately, if we had done it today, it probably wouldn’t have happened,” Siemiatkowski told CNBC in an interview.
Without naming names, Tikey slammed the tech industry for its approach to mass layoffs.
“These are people who may have left other jobs to join your company. These are people who may have moved to other places because of you. These are people who may have ended romantic relationships.
Tikey said managers have a responsibility to protect their employees.
“I believe CEOs should do everything they can to protect their employees,” he said. “I have never seen anything like this in the tech industry. And I hate it.”
“These are people,” he said.
Wefox is a Berlin, Germany based company that connects users looking for insurance with brokers and partner insurers through an online platform. The company was valued at $4.5 billion by investors in a funding round in July.
Wefox says its company is “crisis-proof.” But fellow insurance techs have recently had to make cuts, including Lemonade, which cut 20% of its workforce at Metromile, the auto insurer it acquired in July.
When asked if his own company should make layoffs in response to changing investor sentiment, Tikey said his company was “cautious” about the macroeconomic environment but had no plans for large-scale layoffs.
“I don’t believe in mass layoffs,” Tike said. “We’re going to focus on performance, but not mass layoffs.” Wayfox is “very close” to reaching profitability next year, he said.