Online investment firm Wealthsimple is laying off 13% of its workforce, citing “market volatility”
as the reason for the headcount reduction.
In a letter sent to staff, chief executive officer (CEO) Michael Katchen said 159 of the 1,262
people who work for Toronto-based Wealthsimple will be let go from the company.
Wealthsimple saw its valuation soar during the pandemic, reaching a peak of $5 billion. The
privately held company raised $750 million during its most recent funding round.
However, the current market downturn is forcing the company to concentrate on its core
businesses of investing and banking. Wealthsimple said it plans to lessen its investments in
other areas such as peer-to-peer payments, taxation, and merchant services.
Wealthsimple's job cuts come as global technology companies continue to suffer through a
market correction and face the potential of a global economic recession as interest rates rise to
lower persistently high inflation.
Technology incubators in Toronto and elsewhere across Canada are advising start-up
companies to bolster their cash reserves, prepare for fewer investments from venture
capitalists, and focus on revenue generation.
Wealthsimple was founded in 2014 and is majority owned by Power Corp. (POW). Year to date,
Power Corp.’s stock is down 19% to $33.88 a share.
