Another SoftBank-Backed Company Is Cutting Jobs; Permutive To Reduce 40% Of Workforce, Says Report

Ad tech startup Permutive said this week that it would reduce its workforce, marking another blow to the list of companies backed by SoftBank's capital investment arm that have implemented layoffs in 2023 and during the tech layoffs spree last year.

The London-based ad tech firm's layoffs would affect a little under 80 employees, or about 40% of its staff, Insider estimated. This week's layoffs round follows last year's workforce reduction when the company said it was cutting 12% of its workforce. The company cited over-hiring ahead of the economic downturn at the time.

Permutive, which promises privacy-safe infrastructure for advertisers and publishers, secured $75 million in funding from SoftBank Vision Fund in November 2021, which brought the startup's total funds raised to $105 million.

"As a leader in on-device technology, Permutive can bring a complicated landscape that's being significantly disrupted into a privacy-safe future," Max Ohrstrand, investor for SoftBank Investment Advisers, said in a press release at the time.

Permutive isn't the first SoftBank-backed startup to have implemented layoffs in 2023. At least five other companies that SoftBank Vision Fund invested in announced job cuts in the first quarter of the year.

Last week, smart glass startup View Inc. said in its annual report that it let go of about 170 employees, or nearly a quarter of its entire workforce, as it was at risk of being delisted due to its weak financial data, Bisnow reported. The SoftBank-backed startup also said in its report that it didn't have adequate resources for operational costs that would cover the next 12 months.

The California-based glass company laid off an unknown number of workers in 2020, roughly two years after it secured $1.1 billion in funding from SoftBank. At the time of the layoffs, an employee who worked for several years at the 13-year-old company wrote on LinkedIn that he lost his job due to the pandemic, according to TechCrunch.

Late last month, edtech firm Unacademy slashed more than 350 roles, as per a Slack post that co-founder and CEO Gaurav Munjal wrote for employees.

"We have taken every step in the right decision to make our core business profitable, yet it is not enough," Munjal noted in the message viewed by the outlet. He said the company had "to adapt" to changes in the global economic environment.

Unacademy, which raised $440 million in a funding round led by SoftBank Vision Fund, Singapore's Temasek and other investors in 2021, already implemented layoffs in November 2022 wherein about 350 employees were reported to have been affected.

The Bengaluru-based edtech startup was valued at $3.4 billion after the hundred-million-dollar funding round, but it slashed 1,000 full-time and contractual workers in April last year.

Earlier in March, Philadelphia-based Gopuff laid off about 100 employees or roughly 2% of its global workforce, sources with knowledge of the matter told Bloomberg. The sources said the layoffs affected operations units, including some engineering and information technology roles.

Another Indian company, ad tech firm InMobi, laid off between 50 and 70 employees late in January. A source revealed that the layoffs affected workers from both InMobi and its lock screen-based content provider Glance, the Business Standard reported.

InMobi announced SoftBank's investment of $200 million in the mobile marketing platform in September 2011.

"I hope the partnership with InMobi, a fast-growing startup with significant mobile expertise and an outstanding technology platform, will further accelerate the pace of development in the mobile Internet space globally," Masayoshi Son, CEO of SoftBank, said at the time.

Earlier in January, sports tech unicorn Whoop reportedly slashed 15% of its corporate staff, citing "new challenges and uncertainty" in the macro environment." The company said at the time that it needed to establish "a durable business that is able to withstand whatever economic climate we find ourselves in."

The wearables company led a $200 million funding round for Whoop in 2021 that put the sports tech firm's valuation at $3.6 billion, the Financial Times reported.

In 2022, Insider bared a list of 10 SoftBank-backed startups that implemented job cuts around the same time other tech companies were on a layoff spree. The list included Gopuff, Reef Technology, Cameo, Remote and Better.com, which faced backlash after 900 workers were informed they had lost their jobs in a three-minute Zoom call in early December 2021.

In 2020, a CNN report pointed out that several notable startups that laid off employees in a sweeping manner that year often had the same source for funding: SoftBank. The outlet noted that companies that received funding from SoftBank's Vision Fund and other big investors "went on hiring sprees, acquired other startups and expanded at breakneck speed."

However, Wall Street signaled in 2020 that it "had reached its limit for tolerating wildly unprofitable businesses," raising further concerns about whether startup valuations were too lofty for what the companies were worth.