San Francisco-based supply chain management and logistics company Flexport has announced it is slashing 20% of its workforce amid the slowdown in global trade.
Flexport co-CEOs Dave Clark and Ryan Petersen made the announcement in a note to its approximately 3,200 employees on Wednesday.
“While we are looking forward to what’s to come in 2023, we must also make hard decisions necessary to set us up for long-term success. We are overall in a good position, but are not immune to the macroeconomic downturn that has impacted businesses around the world. Our customers have been impacted by these challenging conditions, resulting in a reduction to our volume forecasts through 2023. Lower volumes, combined with improved efficiencies as a result of new organizational and operational structures, means we are overstaffed in a variety of roles across the company,” the note said.
The layoffs come a little more than four months after Clark took on the role as co-CEO along with Peterson, who founded the company in 2013 and will be stepping aside as of March 1, 2023. Peterson will remain the company’s Executive Chairman.
Clark joined Flexport after serving as CEO of Worldwide Consumer at Amazon.
Flexport is one of Silicon Valley’s rare profitable unicorns. The company has seen explosive growth in recent years, growing from $2 million in revenue in 2014 to $3.3 billion in 2021 and an estimated $5 billion in 2022 as it rode the wave of surging trade volumes during the pandemic. In 2021, Flexport’s technology helped to move nearly $19 billion of merchandise and last year it was named #1 on CNBC’s Disruptor 50 List, as well as one of Fast Company’s Most Innovative Companies.
But as the pandemic-driven trade surge fades, Flexport says it is being forced to become more nimble.
“The current slowdown in volume gives us time to focus on building our technology bench while the economy lags. Then, as the economy recovers, we will be ready to be the Flexport that we all want to be–the one stop for customers to make the movement of goods around the world easy,” Clark and Peterson said their note.
Flexport announced earlier this month that it was bringing on former Microsoft and Amazon executive Teresa Carlson to spearhead the company’s expansion into new global markets, verticals, and strategic partnerships.