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Daily Crunch: Plaid unravels a fifth of its workforce after ‘growth did not materialize as quickly as expected'

Christine Hall
·6-min read

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Hello, and welcome to Hump Day! If you haven’t gotten your fill yet of tech egos, you’ll want to tune into today’s Equity podcast, where Natasha M and Alex talk about how ego brought both Sam Bankman-Fried and Elizabeth Holmes to where they are today.

Mark your calendar for tomorrow’s podcast featuring Walter and Silicon Valley–based attorney and TechCrunch+ columnist Sophie. Beginning at 9 a.m. PST/ 12 p.m. EST, they will discuss immigration-related issues and answer questions about layoffs, work visas and being a visa worker in tech. The audience is invited to send in questions.

Now onward with the news! — Christine

The TechCrunch Top 3

  • More layoffs: I hate that layoffs have become a regular player in this newsletter, but today, Mary Ann writes about fintech company Plaid laying off 20% of its staff, with CEO Zach Perret telling employees that the motivation for the cuts came from “hiring and investing ahead of revenue growth.” I assume companies will get better at forecasting, although, with this macroeconomic climate, it’s probably better to throw the crystal ball out the window.

  • Avatars are everywhere: Speaking of things in the news a lot lately, WhatsApp is rolling out 3D avatars, Jagmeet reports. Just in time for the movie.

  • Bucking the VC trend: Security compliance and automation will never go out of style, and Drata is proving that this sector is still attractive to investors. The company, which helps customers adhere to frameworks, like SOC 2 and GDPR, secured $200 million at a $2 billion valuation. Paul has more.

Startups and VC

Tage is following the happenings over at African fintech Chipper Cash. Already this week, the company announced layoffs, and today we find out that FTX, its lead investor, marked down Chipper Cash’s $2 billion valuation to $1.25 billion shortly before FTX declared bankruptcy.

It was a big day for new funds. Manish writes about India’s Blume Ventures, which more than doubled in size after securing over $250 million for its new fund. Connie reports on 645 Ventures, led by a data-driven duo who just brought in $350 million in capital commitments. And finally, Thoma Bravo has been on an acquisition tear lately, and Ron writes that they now have a record $32 billion in new capital to fuel buyout funds.

Enjoy five more:

  • The VC drop heard ’round Europe: Ingrid gives you an inside look at Atomico’s report on how much venture capital European startups are on track to raise this year.

  • Row, row, row your boat: Harbor Lab secured €6.1 million to automate all the things that happen when you dock a ship in a commercial port. Mike has more.

  • I think this truck smiled at me: Einride’s autonomous and electric truck looks like it has a face. And you might just get to see one for yourself. Paul writes that the company landed $500 million in equity and debt to expand in Europe and North America.

  • No need for a SIM card: Telegram’s Premium offering just reached 1 million paid users, as reported by Manish, and now the company is auctioning virtual phone numbers so that people can use the instant messaging app without a SIM card, Ivan writes.

  • It helps to know what you spend: Today I report on MarginEdge, a restaurant technology company that grabbed $45 million in new funding to collect data in real time from across a restaurant’s back office operations to give merchants a better idea of how much they are spending.

To win over investors, use growth as your differentiator

One bok choy in a row of potatoes
One bok choy in a row of potatoes

Image Credits: Richard Drury (opens in a new window) / Getty Images

Despite the doom and gloom, investors are still meeting with founder teams as they look for places to park their money. Suave storytelling skills are good, but they’re not enough: once you're in the room where it happens, it's critical to make the best use of everyone's time.

To make investor buy-in more likely, Jon Attwell, leader of the Seedstars Growth Track, advises teams to create metric-oriented customer journey maps that detail "all the mini-processes that customers are put through and the pathways they are led down."

Growth projections are nice, but showing investors concrete plans for onboarding and retention, fighting churn and addressing other growth factors will help demonstrate how well you understand your market.

"For investors, it’s a rare treat to see an obsession with the granular metrics of a customer journey," writes Attwell.

To win over investors, use growth as your differentiator

Three more from the TC+ team:

  • We’re not telling you anything you didn’t already know…: But we are putting a TC spin on it. Becca examines fintech unicorn valuations and how hard they have fallen in 2022.

  • Two rich men go into a crypto conference…: Jacquelyn is over at the Benzinga “Future of Crypto” event and caught Kevin O’Leary and Anthony Scaramucci discussing all things SBF, FTX and what’s next for crypto.

  • Complaints go up: Tim has been hearing complaints about the United States’ climate legislation from opponents, which he notes is one sign that it’s already working.

TechCrunch+ is our membership program that helps founders and startup teams get ahead of the pack. You can sign up here. Use code “DC” for a 15% discount on an annual subscription!

Big Tech Inc.

In today’s “ya think?” files, San Francisco is now rethinking its policy on police using killer robots, Paul writes.

I’m often polite to Alexa — my husband rolls his eyes at me when I tell it “please” and “thank you,” so I was intrigued by Amanda’s story today that Amazon will give your overworked delivery driver $5 if you ask Alexa to thank your driver. I mean, why not start that habit in the season of gift-giving? I see my Alexa’s green light flashing right now…

Five more for you: