On October 8, fintech unicorns stash announced that its co-founders, who started the company in 2015 and reduced their roles last year, were returning to lead the company they started.
But one important detail was left out: Stash was also restructuring, and 40% of its roughly 220-person workforce was out of a job, including at least three of its executives, three people familiar with the matter and confirmed. Stash according to people. This was the second major layoff at Stash this year.
The changes come just weeks after 2023’s CEO, Lisa Landsman, abruptly left at the end of September. The board, filled mostly by the company’s venture capital investors, approached co-founders Ed Robinson and Brandon Krieg to run the company as co-CEOs, Robinson explained. destiny.
Robinson stepped down from his management role, although he remained a board member. Krieg had stepped back to lead the development of the business. Robinson described Landsman’s departure as mutual, saying he was neither fired nor resigned. “Lisa did some amazing things for Stash … she just wasn’t the right person to go to the next step,” Robinson said. Landsman has resigned, two people familiar with the matter said. Landsman declined to comment.
At the time of his departure, there were rumors among employees about a potential acquisition, recalls a former employee. And for good reason: Two acquisition offers were being considered by the board at the time, two people say.
One of those offers was from investment platform eToro, which fell short of Stash’s last valuation of $1.4 billion, according to two people familiar with the matter. The exact offer amount could not be confirmed. “We are actively exploring M&A opportunities globally,” an eToro spokesperson explained destinyDeclined to comment on any specifics.
However, the board ultimately rejected those offers in favor of a funding round, which Robinson says is in the process of closing. The company plans to announce the investment soon.
Robinson declined to share any details of the potential funding round, other than that it will be used to pay down some of the company’s debt and spend on growth initiatives. Robinson explains destiny That Stash receives frequent acquisition offers and estimates that around 80 companies have expressed interest in acquisitions in the past six to nine months. He declined to name a specific buyer.
Robinson said the latest restructuring was aimed at removing management layers and making Stash “less bureaucratic”. He stressed that Stash hasn’t killed off any of its products, and that its employees are still working on the same things — just with smaller teams. “We really wanted to try to remove a lot of layers and refocus the company,” he said.
Stash, whose latest $1.4 billion valuation is due in 2021, operates in a crowded space of tech-driven wealth advisory and investment platforms, competing with other companies including Betterment, Acorns, and Robinhood. Stash positions itself as an “investment app for beginners” with a subscription model that provides users with financial advice and manages self-investment services.
Stash, which is based in New York City but whose staff is largely remote, does not disclose its revenue or other financials.
Stash Touts now has more than 1.2 million subscribers, although that figure shows a decline from 2022, when the platform C 2 million. The company has struggled with debt, and held a series of layoffs before October, including one in March representing 25% of its workforce, or about 80 people, bringing its total to 220 at the time. has gone
According to Axios, the company had 500 employees at its peak Report.
“The common sense was that competitive pressure was mounting, so things had to be tougher,” says a former employee.
The October restructuring was not mentioned in the company’s external announcement about the co-founders returning as executives, although two sources say it was the same day the company announced its layoffs internally. A Bloomberg article published the same day about the restructuring also did not mention the cuts.
Robinson said the company is not considering further layoffs and achieved positive monthly cash flow in November — the first time in Stash’s 10-year history. He highlighted a new AI investment tool introduced this year and said that Stash is considering adding crypto trading back to its platform, which was discontinued under Landsman.
