Layoffs in Brazil

Brazilian proptech unicorn Loft conducted its second round of layoffs in July 2022, cutting 384 employees, which represents 12% of its then 3,200-strong workforce. This follows an earlier dismissal of 159 staff in April, attributed to the integration of CrediHome. The company cited a strategic shift towards increased efficiency after four years of aggressive growth, both organic and through acquisitions. This move reflects a broader "winter" for startups, particularly high-growth, cash-burning unicorns, as rising interest rates and market volatility force cost-cutting measures and down-rounds. Loft offered affected employees extended health benefits and outplacement support.

Ebanx laid off 340 employees representing approximately 20% of its workforce on 2022-06-21.

Sami, a Brazilian healthtech startup, has laid off approximately 75 employees, representing about 14% of its 550-person workforce. The layoffs, conducted via video calls, are a response to what the company describes as an "extremely high" monthly cash burn of R$7.5 million. Founder Victor Asseituno confirmed the cuts, stating the company is under pressure from venture capital funds to achieve breakeven and find a path to business sustainability. This move reflects a broader shift in the venture capital market, where the focus has pivoted from aggressive growth to cost reduction and profitability. Sami, which raised R$111 million just six months prior and grew sixfold in the past year, joins a growing list of startups, including unicorns like Quinto Andar and Loft, conducting layoffs amid a global downturn in VC liquidity.

In June 2022, the Brazilian healthtech startup Sanar laid off at least 60 employees, representing approximately 13% of its total workforce. The company, which operates a medical education platform for healthcare professionals, cited market volatility and macroeconomic uncertainty as reasons for the restructuring, aiming to improve internal efficiency. The layoffs, conducted via brief meetings, came as a surprise to staff who had valued the company's previously transparent and friendly work culture. Affected roles spanned multiple departments including marketing, design, and recruitment.

Mexican startup Kavak, Latin America's largest unicorn, has laid off at least 150 employees across its operations in Rio de Janeiro and São Paulo, its key markets in Brazil, with cuts occurring since March 2022. The layoffs, affecting roles from mechanics and inspections to content and operations, are attributed to underperformance in its used car buying and selling business. In Rio alone, recent dismissals reached around 100, including 40-50 at its Nova América location, which had 150-180 staff. This downsizing contrasts with earlier expansion plans, such as investing R$550 million and hiring 1,000 employees in Rio by year-end, signaling a strategic pullback amid operational challenges in the competitive automotive retail industry.

Afterverse, a gaming company under Movile (owner of iFood), laid off approximately 60 employees on June 3, 2022, representing about 20% of its then 270-person workforce. The layoffs are attributed to global market conditions and internal strategic realignments, as the company reprioritizes initiatives. This move places Afterverse among numerous tech startups in Brazil, such as Mercado Bitcoin and VTEX, that are reducing staff amid a challenging investment climate. The company, known for games like PK XD and Crafty Lands, is focusing on reaching profitability and scaling its operations, having recently hired UBS to seek a strategic partner.

Favo laid off 170 employees on 2022-06-02.

On June 1, 2022, the Brazilian cryptocurrency group 2TM, owner of Mercado Bitcoin and valued at $2.1 billion, laid off 90 employees, representing about 12% of its workforce of approximately 750. The company cited a challenging global economic environment, including rising interest rates, inflation, and significant volatility in Bitcoin's value, which had halved over the previous six months, as reasons for the restructuring. This move was part of broader cost-cutting measures amid a wave of layoffs at other Brazilian unicorn startups. 2TM, which had expanded through acquisitions like the Portuguese digital currency exchange Criptoloja, offered affected employees a benefits package including job placement assistance and extended health insurance.

In May 2022, the fintech company SumUp laid off approximately 100 employees in Brazil, citing the "economic instability" in the region as a key reason. This reduction affected its team in Brazil and represented a small percentage of its global workforce of around 3,000. The layoffs were part of a broader trend of workforce reductions within the fintech startup sector, which was under pressure to demonstrate profitability after a period of rapid growth. SumUp, a prominent payment provider, had been seeking new funding earlier in the year at a high valuation, but market conditions were becoming more challenging. The decision followed earlier layoffs at other fintech firms like Klarna, Kontist, and Nuri, highlighting ongoing pressures in the industry.

VTEX laid off 200 employees representing approximately 13% of its workforce on 2022-05-26.

Brazilian e-commerce unicorn Olist conducted layoffs on May 23, 2022, affecting all areas including technology, business, and product. While rumors suggested around 150 employees were impacted, the company's founder denied this figure, stating the number was significantly lower and that Olist still had open positions. The exact number of layoffs was not disclosed. As of December 2021, Olist had 1,400 employees and had planned to hire 300 more in 2022. The founder attributed the adjustments to the new macroeconomic scenario and the need to correct inefficiencies that arise as a company scales, emphasizing that Olist's revenue grew 3.5 times in 2021 and that no projects would be discontinued. This move occurred amid a wave of layoffs at other Brazilian unicorns like QuintoAndar and Loft. Olist, which reached a $1.5 billion valuation in late 2021, specializes in helping physical stores sell on major marketplaces.

Brazilian restaurant management startup Zak laid off approximately 40% of its workforce, affecting up to 100 employees, in a restructuring move announced via videoconference on Friday, May 13, 2022. The layoffs primarily impacted the operations, product, marketing, and sales departments. Founded in 2018 and based in São Paulo, Zak digitizes manual restaurant processes like cash management. Despite raising R$80 million in a 2021 funding round led by Tiger Global with plans to double its team, the company cited the need to restructure as the reason for the cuts, which occurred during a wave of layoffs at Brazilian unicorns.

In April 2022, Brazilian social commerce unicorn Facily laid off over 260 employees, representing more than 30% of its then 860-strong workforce. The cuts, particularly severe in the technology department, came less than six months after the company achieved unicorn status. This move was part of a broader reassessment of growth plans amid a troubled global economic scenario that restricted investment funds, especially for high-burn-rate startups. While Facily had previously announced expansion into Mexico, Colombia, and financial services, it cited a need for efficiency and evolution without directly commenting on the layoffs.

Loft laid off 159 employees on 2022-04-19.

QuintoAndar laid off 160 employees representing approximately 4% of its workforce on 2022-04-19.

In February 2022, Brazilian foodtech startup Liv Up laid off over 100 employees, representing 15% of its workforce. This restructuring followed investments that did not yield the expected returns, prompting a significant cost reduction. The company, which had reported having 800 employees in September 2021, stated the move was to create a leaner operation and focus resources on projects better aligned with the current challenging macroeconomic reality and shifting consumer habits. The layoffs were part of an effort to streamline the business and concentrate on building its position as a major healthy food brand in the country.

In May 2021, German-British fintech SumUp laid off a three-digit number of employees as part of a restructuring effort, despite having recently secured a €750 million credit line from investors like Goldman Sachs. The company, which provides card terminals to small businesses and employed around 2,600 people across 15 locations, cited the need to build a resilient company during challenging times, particularly as the COVID-19 pandemic severely impacted its merchant clients. This move came as a surprise following earlier expansion announcements and ongoing hiring, with about 90 positions still advertised at the time. The layoffs, confirmed by co-founder Marc-Alexander Christ, affected staff in various global offices and were aligned with strategic goals to streamline operations while continuing product and market expansion.

Ebanx laid off 62 employees representing approximately 8% of its workforce on 2020-05-27.

Mercos, a Brazilian technology company, has laid off 51 employees, representing 40% of its workforce, in March 2020 due to the severe economic impact of the COVID-19 pandemic. The layoffs reduced the team from approximately 125 total employees to 74. The company, which had achieved break-even and strong growth in 2019, faced an abrupt downturn as the global health crisis unfolded, leading to this difficult decision to ensure financial stability. This event marked a significant challenge for the firm, which highly values its company culture.

Stone laid off 1,300 employees representing approximately 20% of its workforce on 2020-05-12.

TutorMundi laid off 4 employees representing approximately 100% of its workforce on 2020-04-24.

Movidesk, a Blumenau-based technology scale-up providing a help desk platform, laid off 33 employees in April 2020, representing approximately 25% of its then 134-person workforce. The layoffs were a direct result of the economic crisis triggered by the COVID-19 pandemic, which caused a significant and immediate drop in new sales, contract cancellations, reductions, and increased client payment defaults. Despite rapid growth and recent venture capital funding, the company stated that payroll consumed nearly all revenue, making the staff reduction necessary after other cost-cutting measures proved insufficient.

ContaAzul, a Brazilian fintech platform for small and medium-sized enterprises, laid off 140 employees in April 2020 as part of coronavirus-related restructuring. The company, which helps businesses manage accounting, faced economic pressures from the pandemic and sought to streamline operations. While undergoing these cuts, ContaAzul also launched initiatives like free online courses to support SMEs during the crisis. The layoffs reflect broader challenges in Brazil's startup ecosystem, where multiple companies, including GetNinjas and Oyo, also reduced staff due to the downturn.

In April 2020, Brazilian real estate rental startup QuintoAndar laid off approximately 8% of its workforce, affecting around 88 employees out of a pre-crisis total of 1,100. The layoffs, which occurred across all areas of the company, were a direct response to the COVID-19 pandemic, which led to a projected decline in demand for residential rental and property sales. As a unicorn valued at over $1 billion, QuintoAndar stated the restructuring was necessary to adapt operations to the new market context and ensure the company could meet its commitments. The affected employees received a comprehensive benefits package, including extended health coverage and support services. This move was part of a broader wave of layoffs across Brazilian startups and tech companies during the early stages of the pandemic.

QuintoAndar laid off 88 employees representing approximately 8% of its workforce on 2020-04-17.

Xerpa, a Brazilian HR and payroll technology company, laid off 10 employees due to drastic market changes caused by the COVID-19 pandemic. This difficult decision, announced in a post by company leadership, was part of an adjustment to the company's profile to navigate the ongoing crisis. While the exact total workforce and percentage affected are not specified in the announcement, the layoffs impacted a close-knit team, described as "amazing friends and colleagues." The company expressed confidence in its remaining team and future, while actively recommending the affected professionals to other employers in the industry.

In April 2020, Brazilian fintech Neon laid off less than 10% of its workforce due to the economic impact of the COVID-19 pandemic. With a total of around 700 employees at the time, this adjustment meant fewer than 70 people were affected. The company, which offers digital banking services and had grown rapidly in 2019, stated that part of the layoffs were performance-related, while another portion was linked to areas directly hit by the crisis, such as services for small and medium-sized businesses. The São Paulo-based startup, backed by significant investments, was among several Brazilian companies forced to make cuts as the coronavirus disrupted economic activities.

In April 2020, Brazilian fintech startup BeeTech laid off 35 employees. This reduction was part of a broader wave of layoffs across Brazil's startup sector, which saw nearly 1,000 job cuts at over a dozen companies due to the economic uncertainty caused by the COVID-19 pandemic. BeeTech, which operates services like BeeCâmbio and Remessa Online, had experienced significant growth in 2019, hiring over 160 new staff, many in anticipation of continued expansion. However, faced with sudden market disruptions and impacts on its business planning, the company made the difficult decision to reduce its workforce across various departments to conserve cash and navigate the crisis.

In April 2020, Brazilian management platform startup Omie (Omiexperience) laid off approximately 136 employees, representing about 31% of its then 439-person workforce. The layoffs occurred in two waves, driven by a combination of internal restructuring and the direct economic impact of the COVID-19 pandemic. The first wave of 42 dismissals was attributed to a strategic shift to serve larger enterprise clients and an adjustment for unmet growth projections. The second wave of 94 cuts was a direct response to the coronavirus crisis, which disrupted client demand despite initial expectations that remote work trends would boost business. Affected departments included marketing, sales, customer relations, franchises, and human resources. The company maintained salaries and benefits for remaining staff and launched a free tool to support micro-entrepreneurs during the downturn.

MaxMilhas laid off 167 employees representing approximately 42% of its workforce on 2020-04-03.

Gympass laid off 467 employees representing approximately 33% of its workforce on 2020-04-03.

Brazilian real estate startup Loft laid off approximately 380 employees in April 2022, representing about 12% of its workforce at the time. The company, which operates a digital platform for buying and selling residential properties, cited a strategic restructuring and a need to adapt to a shifting global economic landscape as reasons for the workforce reduction. This move was part of a broader trend of cost-cutting and operational adjustments within the tech and proptech sectors during that period.

Bcredi on 2020-03-27.