Robinhood announces layoffs, sheds 9% of full-time workforce
Stock trading app Robinhood is to cut 9% of its full-time workforce as the company adjusts to the economic environment of the post-pandemic era and aims to continue its mission to “democratise finance”.
Robinhood CEO Vlad Tenev announced the move to employees at a company-wide meeting, citing duplicate roles and job functions and “more layers and complexity than are optimal” after a period of “hyper growth”.
Tenev says the company is also “scrutinising” headcount growth targets and prioritising “opportunities for automation”.
The firm experienced “rapid headcount growth” as it rode a pandemic-era boom accelerated by lockdowns, historically low interest rates and fiscal stimulus.
During 2020 and H1 2021, Robinhood’s net funded accounts grew from 5 million to 22 million and its revenue shot up from around $278 million to more than $1.8 billion in 2021.
In order to keep up with this growth, the company’s workforce expanded from 700 to nearly 3,800.
“After carefully considering all these factors, we determined that making reductions to Robinhood’s staff is the right decision to improve efficiency, increase our velocity, and ensure that we are responsive to the changing needs of our customers,” Tenev says.
Tenev adds the redundancies will ensure the company can deliver on its strategic goals, with product and international expansion both in the pipeline.
Robinhood will introduce new products in 2022, including brokerage, crypto and spending and saving products.
Tenev says the company’s finances are robust, with more $6 billion on its balance sheet. “To keep it that way we’re being responsive to changes in the way our customers invest — especially during this time of global conflict, economic uncertainty, and high inflation.”