SeekOut, an eight-year-old recruitment startup that uses AI to find candidates, cut about 30% of its workforce on Thursday, TechCrunch learned.
In a letter to employees, SeekOut CEO Anoop Gupta and CTO Aravind Bala said, “These days, we spend about $2 for every $1 we make, and in the last year… There was a large amount of cash burn.” “Unfortunately, to put our company on a sustainable trajectory, we will need to significantly reduce our workforce.”
According to the letter, the company has made the decision to refocus and prioritize a small number of initiatives that have the greatest impact on customers and add value to the business.
“This reduction is a strategic measure aimed at strengthening our financial position and maintaining our competitiveness in talent acquisition and management. Retiring employees are receiving extensive support,” SeekOut said in a statement. Sam Shaddox, general counsel and chief privacy officer, told TechCrunch via email.
This is the second time the Seattle-based startup has cut jobs. SeekOut laid off 16 employees in October, about 7% of its workforce at the time, GeekWire reported. The company now has about 200 employees after layoffs in October, according to the report.
SeekOut was last valued at over $1.2 billion after raising $115 million in a Series C round led by Tiger Global in January 2022. At the time, the company's revenue was growing 300% annually, with annual recurring revenue (ARR) ranging from $25 million to $50 million.
However, the hiring environment has changed significantly since then. The rising interest rate environment has made it much easier to find talent in areas such as technology, causing both large corporations and startups to pay more attention to their bottom lines.
Tech giants like Alphabet and Meta have laid off thousands of workers from 2022 to 2023. This trend will inevitably hurt the seekout business. The company's software helps large companies in industries such as technology, pharmaceuticals, aerospace, defense, and banking identify their “hardware.” ” and diverse candidates.
SeekOut's other investors include Madrona Venture Group, Mayfield, and GV.