After various reports on possible layoffs last week, Flexport founder and CEO Ryan Petersen told employees that the company will be laying off 20% of its workforce starting Friday.
Petersen said in a published note Thursday that over the last month, the leadership team has “evaluated every role in the company and its relationship to solving important supply chain problems for our customers.” In turn, the CEO said he was confident that the reductions would not impact the customer service experience.
“With more than $1 billion in net cash, following this change, Flexport is now in a great position to take advantage of the opportunities in front of us to return to profitability as soon as the end of the next year,” Petersen said in the note. “With today’s change, we’ll be able to get back to profitability without raising prices or placing our fortress balance sheet at risk.”
Petersen also emphasized that Flexport remains committed to pursuing its “long-term technology vision.”
Layoffs will carry into next week, and severance packages will vary by location, the CEO said. U.S. workers will receive nine weeks severance, two months extended healthcare through the end of the year and access to immigration support. Employees located outside of the U.S. will get details about their separation packages upon notification.
Flexport also plans to have a team of dedicated recruiters help departing employees look for job opportunities. Petersen said the team will work with more than 300 companies that have “expressed an interest in hiring departing Flexporters to match opportunities with impacted employees.”
Flexport has undergone a slew of changes over the past several months, including an initial round of layoffs earlier this year. Flexport also saw the departure of its then-CEO Dave Clark in September, as well as several other company leaders.