Rival fintechs Revolut and Wise are still recruiting
Nikolay Storonsky, founder and CEO of Revolut.
Harry Murphy | Sports file for Web Summit via Getty Images
Not all fintech unicorns cut jobs.
After Klarna announced plans to lay off 10% of its workforce on Monday, some competing fintechs make it clear that they have no intention of cutting jobs or freezing employment.
Revolut, the $ 33 billion digital startup, said the company “actively hires”[ads1];, with over 250 open roles listed on the site.
Meanwhile, Wise CEO Kristo Kaarmann said the London-based money transfer company is in a “different place” than technology companies that let employees go.
“Years of building Wise as a profitable long-term company are paying off now,” Kaarmann tweeted on Wednesday.
“So much demand for international banking, we can not hire people fast enough to build it.”
Meanwhile, the German digital bank N26 said it has “no current plans to reduce the number of employees.” The company was last valued at $ 9 billion.
“We will continue to make strategic investments to expand our team with a focus on product, technology, compliance and the prevention of financial crime,” a N26 spokesman said.
It marks a stark contrast to Klarna. Buy Now, Pay Later company – which allows customers to split their purchases into equal, monthly installments – said it plans to cut an estimated 700 roles due to a poorer economic climate.
– When we set our business plans for 2022 in the autumn of last year, it was a completely different world than we are today, Klarna CEO Sebastian Siemiatkowski told employees in a pre-recorded video on Monday.
“Since then, we have seen a tragic and unnecessary war in Ukraine unfold, a shift in consumer sentiment, a sharp rise in inflation, a very volatile stock market and a likely recession.”
Other financial technology companies, such as Robinhood and Better.com, have also taken steps to cut jobs and curb costs this year.
Digital finance received a big boost from the Covid pandemic when people turned to online channels to make payments, apply for loans and trade shares. But the sector has been beaten in 2022 as the war in Ukraine, rising inflation and higher interest rates have led investors to question high valuations in the area.
Wise, for example, has lost almost two-thirds of its market value since its listing in July 2021.
Rishi Khosla, CEO of the British online lender OakNorth, said that there have been “massive bubbles” in fintech – from buy now, pay later to crypto. He said that BNPL had been allowed to flourish largely thanks to “regulatory arbitrage”.
“Ultimately, regulation will catch up with them, and therefore this opportunity will not continue,” he said.
Klarna is reportedly seeking funds with a 34% discount compared to its last investment round, which valued the company at 46 billion dollars. A spokesman for Klarna dismissed this as speculation.
Asked if Revolut plans to follow suit, a spokesman for the company said they do not intend to do so.