Pre-seed fintech investor Techstars cuts global workforce by 17%
Start-up accelerator Techstars is set to cut its global workforce by 17% having “overbuilt and over hired to support our ambition to scale”, according to co-founder and CEO David Cohen.
Techstars cuts global workforce by 17%
In an email delivered to staff dated 7 August and published on the company’s website, Cohen writes: “We built a business with the capacity to support thousands of new investments annually but the reality is that we have been investing in around 700 start-ups a year.
“We are going to stop focusing on scaling and shift all of our focus to being better for founders each and every day.”
Cohen says that the move will see team reductions “come predominantly from engineering, portfolio services, and sales/partnerships”, adding that Techstars’ accelerator teams “will be largely unaffected by these actions”.
However, he also states that “when the Advancing Cities fund is fully deployed at the end of this year, the Techstars powered by JP Morgan branded accelerator programs will come to an end”.
Launched in spring 2022 and supported by JP Morgan, the $80 million fund was designed to invest in more than 400 companies across nine US cities through 2024. “Open to founders of all backgrounds, the fund was raised with the aim of providing equitable access to funding and support for entrepreneurs who are Black, Hispanic and Latino, Indigenous American and Pacific Islander,” according to Techstars.
Cohen notes that the upcoming closure of the Advancing Cities programme does not change any of Techstars’ other accelerator programmes and schedules.
“While this is a necessary business decision, it doesn’t make it any less painful,” his email continues. Techstars was contacted by FinTech Futures for comment.
Techstars maintains a prominent position in funding rounds for early-stage fintech start-ups worldwide. This year alone, the platform supported embedded software fintech Parlay in raising $1.3 million in February, Czech embedded software provider Flowpay in securing €2.1 million in March, and UK-based wealth management solutions firm Avenir in landing $530,000 in April, following the start-up’s participation in the ABN Amro + Techstars Future of Finance accelerator programme.
Last month, Techstars also announced the promotion of SVP and senior controller Jonathan Geehan to the position of CFO.
