Progressive Future Super parent to lay off 1 in 4 staff in cost-cutting move

Future Group, the parent company of progressive superannuation funds like Future Super and Verve, is laying off 1 in 4 employees in a cost-cutting effort following a string of acquisitions.

Climate 200 group founder Simon Holmes à Court.

Future Group, the company behind progressive superannuation funds like Future Super and Verve Super, is laying off 1 in 4 employees in a cost-cutting effort following recent acquisitions.

Founded in 2014 as Future Super by former GetUp! director Simon Sheikh and one-time Greens candidate Adam Verwey, the group now owns five funds, growing assets under management over 10 times in the past four years to $14bn through several acquisitions.

On Monday, workers were told the company plans to make 42 people redundant to shrink the total headcount to about 116 people, down from 158, currently as it streamlines operations. About 61 roles will be retained with minor changes, 44 will have no changes to their roles, and 11 are expected to be redeployed, according to people familiar with the situation.

Despite the lay-offs, the company told staff it was also planning to make about 14 new hires, the sources said. When that is done, the group’s total headcount will be about 130, they were told. The hires included investment professionals, a head of partnerships to build and manage agreements with employers across all funds, and human resources personnel.

Future Groupis laying off nearly a third of its employees in a cost-cutting effort following recent acquisitions. Picture: David Crosling/NCA NewsWire

Earlier this week, Mr Sheikh hinted at the cuts in a LinkedIn post that did not mention the magnitude of the lay-offs.

He said, however, the company’s “reshape” was necessary as it moved to centralise operations where a “single integrated team” will run its five brands.

“Now that our acquisitions are finalised, we need to reshape our organisational structure to execute our strategy,” Mr Sheikh said in the post.

“Put simply, we are moving from being a group of acquired businesses to a single integrated team running multiple brands. Sadly, this means saying farewell to some valued individuals who’ve made important contributions to our mission.”

Sources said a large portion of the redundant roles involve staff in member services and marketing roles.

Head of communications Alana Theodor confirmed there were “around 40” roles impacted by the “reshape.” She told The Australian the company was still in “detailed consultations” with employees and confirmed the 130 headcount target, adding final numbers were still being worked out.

The plans to recruit 14 people would fill “capability gaps” the group had identified. “A number of our impacted team have expressed interest in these roles,” she said.

According to media reports, Future Group was last year valued at over $240m during an equity raising. It counts Climate 200 founder Simon Holmes à Court as a long-term investor with a modest share, alongside other green minded shareholders.

Climate 200 group founder Simon Holmes à Court.

The original Future Super has been a vocal champion of fossil fuel-free investing, but now with a diversified pool of assets acquired through the mergers, its initial strict ethical investment focus has been diluted.

Recent acquisitions include pharmacy workers fund GuildSuper and ChildCareSuper last year, and corporate superannuation fund smartMonday - by far its largest - which it bought from global insurer Aon, in 2022.

“All that we’ve achieved in building this business has been on the shoulders of our team. I’m so grateful for their diligence, passion and hard work and I’d love to help impacted individuals find their next roles so please reach out if you can help,” Mr Sheikh’s post said.

In an email notifying investors on Monday, Mr Sheikh explained the company had until now been focused on completing the back-office integration of its 5 brands, but had kept separate operations for each of them.

“To deliver continued growth and achieve the impact we seek to make, we feel that our business must now shift to operating as a single team structured to support multiple brands,” the memo says.

“This impacts all parts of our operating model, from the technology we use, the way we serve our members, what elements of our work we insource and what elements we outsource.”

He said the company would move into a single administrator and back-end platform, and will ditch separate marketing departments for each “promoter/brand”, in favour of a group marketing function that focuses on all brands.

The move would also ensure its “cost base is aligned with our ongoing capital requirements and that our back office efficiencies provide us with an ability to drive down fees for members over time,” he said.

He said the week would end having farewelled “valued individuals” who made important contributions to its mission, which he said was to use its brands and “the power” of its members’ super savings to “drive change” in the $3.5tn industry.

“While we have identified several redeployment opportunities for impacted team members, we don’t expect that we will be able to find roles for all individuals,” the memo says. “Our team will be supported with a well-designed and above-market support package.”