Brazil’s logistic unicorn Loggi laid off around 500 employees – 15% of its workforce of 3.000 professionals. Startups has found that several departments were affected by the cull, including technology, design, and recruitment. In Lisbon, Loggi cut 40% of its workforce – around 35 employees who worked in its technology hub – were also dismissed.
“It wasn’t a surprise, but we didn’t think the tech department would also be affected,” said a former Loggi employee heard by Startups. Another former employee confirms that the team had already anticipated the cuts. “A management consultancy firm has been working at Loggi for months to review the budget. Being a logistics startup, we know there was a boom in the pandemic, and now the revenue has decreased,” she says.
The decision to let these people go was made to reduce costs, given the current market situation. The former employees will receive a three-month health plan allowance, and the company will help them with professional relocation. Loggi is also going through other changes: in an email sent to the teams, the company announced that it was changing the CEO and that the founders were joining the company’s board.
Startups reached out to Loggi, who said the cut “is part of a set of actions to increase operational efficiency to adapt the company to the new global scenario and ensure the sustainability of the business”.
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“We are grateful for the dedication of our team and reinforce that we have offered a benefits package that includes cost aid for contracting a health plan for holders and dependents, psychological assistance, and support in finding a new job. Loggi also reiterates its purpose of transforming business by connecting Brazil with a simple and innovative delivery experience,” the company said in a statement.
Planning an IPO
A source told Startups said that conversations about Loggi‘s IPO had been going on for at least two years. The appointment of the CFO – and now CEO – Thibaud Lecuyer, would have been motivated to structure the internal processes with the hopes of going public on the stock exchange soon. Last week, Startups found out that Lecuyer is taking on a new challenge in the company as CEO. Founder Fabién Mendez is stepping down to take a seat on the company’s board of directors.
In February 2021, Loggi raised BRL 1.15 billion (over $200 million), led by manager CapSur Capital and backed by Verde Asset Management, which traditionally invests in publicly traded companies (Loggi‘s investment was the first in a private company).
Loggi also raised money from SoftBank. In recent months, other companies in SoftBank‘s portfolio have also shrunk operations. In May, VTEX cut more than 10% of its workforce. Healthtech Alice laid off 63 employees seven months after raising $127 million. Brazilian proptechs Loft and QuintoAndar were also affected by the layoffs wave.
Last week, SoftBank reported one of the worst results in its history, with a $21.6 billion loss in its first fiscal quarter. Masayoshi Son, SoftBank‘s founder and CEO, said the megafund would “reduce dramatically” its staff in several business units to gain more efficiencies.
