Events tech company, Hopin cuts 242 staff members during second round of layoffs

It was once regarded as Europe’s fastest growing start-up. Now this company has been forced into letting hundreds of staff go.

After soaring to a valuation of $US7.8 billion ($A11.58 billion) during the pandemic in August 2021, events-tech company Hopin has recently laid off 29 per cent of its staff.

In their second round of lay-offs to hit staff this year, 242 staff were cut on Tuesday. The move comes just four months after 12 per cent, or 138 full-time staff, were dumped in February.

According to TechCrunch, affected employees will receive three months of compensation, be able to keep their laptops and access to the company’s health and mental health benefits. Employees with stock options, will also have access to their equity sooner, with Hopin dropping their one-year vesting schedule.

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The events tech platform recently cut nearly 30 per cent of its staff. Picture: Hopin.

In a statement made to TechCrunch, a spokesman said the lay-offs affected some senior executives, as well as contractors and members of a third-party team who were not included in the 242 figure.

The “difficult decision” was also made after “preventive measures” like a hiring freeze and reduction in marketing spend were implemented.

“We’ve made the very difficult decision to reduce our workforce given the current macroeconomic climate and need for our events product to move forward efficiently,” the spokesman wrote in an email.

“It became necessary to simplify our events business and supporting operations to build a profitable and sustainable company.”

Employees who were let go during this round will still have access to their laptops and health care. Picture: Hopin.

Hopin’s lay-offs comes as tech companies have been battered by tough global economic conditions and increasing competition.

Global streaming juggernaut, Netflix sacked roughly 450 staff out of its 11,000 worldwide talent pool in two rounds of lay-offs in May and June. This came as a spokesman admitted the company needed to balance their costs which were “growing in line with our slower revenue growth”.

Closer to home, Melbourne-based tech company Envato also sacked 100 staff in early June, despite recording $228.5 million in revenue in the past financial year. Envato CEO Hichame Assi said the redundancies were part of a need to update its “focus” and core products after 16 years of operating.

According to Crunchbase, 21,000 staff have been laid off from US-based start-ups in 2022 alone, with late-stage venture-backed companies hit the hardest. This refers to companies that have raised received Series C funding from venture capitalists.

Tech companies globally are struggling in Picture: Robyn Beck/AFP

Hopin was found by Australian-born, British billionaire Johnny Boufarhat in 2019, when the pandemic boosted the demand of videoconferencing services. Their July 2021 Series D funding saw Hopin raise $470 million alone, with the company raising more than $A1 billion since the start of the pandemic in February 2020.

Unlike Zoom and other services, Hopin distinguished itself from competitors by allowing up to 100,000 users participate in ’Stage’ call, where viewers can watch a speaker. Up to 5000 are also allowed on a ‘Session’ call, which allows users to speak and interact with each other.

Hopin CEO Johnny Boufarhat. Picture: Twitter.

Speaking to CNBC in August 2021, Mr Boufarhat said that despite Hopin growing quickly before the pandemic, Covid was a “massive accelerator”. During this period, Hopin’s illustrious client base include major companies like American Express and NATO.

“Quite a few things that had to click in place for that to happen were out of my control,” he said. “It’s actually sad, we wish Covid never happened. We were still growing fast pre-Covid but obviously Covid was a massive accelerator for the company.”

In terms of staffing, CNBC reports they jumped from eight team members in March 2020, to 800 in August 2021.

After the latest round of redundancies, Hopin’s headcount now stands at around 590.