IA Upstart’s lending platform lays off 7% of its staff
- ByStartupStory | November 2, 2022
Reached, an AI lending platform, laid off 140 employees, or 7% of its entire workforce, following sharp increases in U.S. interest rates that lowered demand for loans. The lending platform, which employs around 2,000 people, informed affected workers on Tuesday that they would be made redundant.
In its latest filing with the U.S. Securities and Exchange Commission (SEC), it said the decision was made in the wake of “decline in the number of loans” on its platform and continued economic difficulties. The platform reported a 72% annual increase in lending volumes in its latest quarterly statistics. This year, the company’s share price has fallen 84%.
Upstart once had a market cap of $32 billion. It is currently less than $2 billion. Many tech companies have been hit by the global economic downturn, including those in India, due to the severe shortage of capital for startups.
“Given the difficult economic situation, we are making this difficult decision for the long-term health of the business. We do not expect any further layoffs and continue to hire for strategic positions for our business,” said an Upstart spokesperson.
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