Israeli fintech company Payoneer to lay off 200 employees

The tech unicorn undergoes a restructuring process just four months after the appointment of John Caplan as CEO; company has 2,000 workers, half of them based in Israel

Sophie Shulman, Calcalist|
Israeli fintech company Payoneer is set to initiate a substantial round of layoffs, just four months after appointing a new CEO. The company, listed on Nasdaq with a market capitalization of approximately $1.7 billion, will be parting ways with 200 employees, constituting roughly 10% of its workforce.
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The exact number of employees affected in Israel is currently unknown. Israel serves as the primary location for Payoneer's research and development, with approximately half of its 2,000 employees based there. The layoff process is scheduled to start this week.
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John Caplan
John Caplan
John Caplan took over as Payoneer CEO four months ago
(Photo: YouTube)
Established in 2005, Payoneer has emerged as one of Israel's most promising tech unicorns. The company operates within the expansive payments and clearing market for small and medium-sized businesses, which it estimates to be valued at $5 trillion. Payoneer's revenue model revolves around collecting commissions from payments made on its platform, which spans over 190 countries. Recently, the company partnered with credit card giant Mastercard to launch a dedicated solution.
In June 2021, Payoneer went public through a SPAC merger on Nasdaq, with a valuation of $3.3 billion. The process generated over a billion dollars, with funds allocated to the company, as well as its founders and long-term shareholders, including former Prime Minister Naftali Bennett, who had made early investments.
The decision to downsize the workforce at Payoneer arises from a combination of macroeconomic conditions and the management's strategic focus on achieving profitable growth. The company experienced lower-than-anticipated business-to-business payment volumes on its platform during the first quarter of 2023. The majority of layoffs are expected to primarily affect the marketing and service departments, while the impact on the development sector will be minimal. Consequently, the number of employees laid off in Israel is projected to be relatively small.
In March, Payoneer announced the transition of John Caplan from co-CEO to full-time CEO, succeeding veteran CEO Scott Galit, who remained on the company's board of directors. Additionally, Bea Ordonez was appointed as the new CFO. The new management introduced a revised strategy, prioritizing large and profitable customers while developing a new generation of the payments platform.
Upon assuming the CEO role, Caplan emphasized the significance of the quarter of Payoneer's customers who generate substantial revenues and activity. Going forward, the company's marketing and services efforts was set to focus on serving these half a million customers. To optimize financial efficiency, Payoneer halted new hiring from May 1, with anticipated cost savings of $5 million by the end of 2023. Ordonez also highlighted ongoing evaluations of the cost structure to eliminate redundant positions without impeding development.
Projections indicate that Payoneer aims to achieve approximately 30% growth by the end of 2023, resulting in revenues of $810-$820 million. The company began the first quarter on a positive note, reporting a net profit of $8 million, partially attributed to interest income from a cash fund totaling half a billion dollars. Notably, Payoneer plans to recruit dozens of developers and product managers in Israel to bolster its financial cloud capabilities.
In response to these developments, Payoneer emphasized its commitment to implementing prudent measures aimed at enhancing organizational efficiency. Furthermore, the company affirmed its ongoing plan to hire 150 employees for its Israeli development center, as previously announced in March.
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