Funding Circle will cut 120 jobs to slash costs

Funding Circle, a small business lender headquartered in London, announced recently the decision to cut 120 jobs. The decision was made as the company seeks to slash costs in order to reach profitability.

Funding Circle Decides To Go For Simplicity And Profitability

According to Funding Circle, the job cuts will include 14% of its non-US workforce. The company said that the cuts will cost about £5 million in 2024, but in the long term, it will be beneficial. According to the firm’s predictions, the cuts will secure an annualized run rate cost saving of £15 million in 2025.

The company came to a decision after a particularly bad situation in 2023 when the firm posted a £33.2 million loss. After considering its options, it made a decision in March 2024 that it is better to go for simplification coupled with profitability.

The business is further seeking to achieve its goals by posting its loss-making US division up for sale. It noted that it is currently in discussions regarding a potential transaction and that the negotiations are proceeding well for the time being.

Funding Circle’s CEO, Lisa Jacobs, commented on the firm’s current situation, stating that the reduction in roles is not a decision that the firm reached lightly. She said that she is thankful to all the departing members of the team for their hard work and commitment.

Big Changes Are Coming For Funding Circle

Apart from laying off 120 members of the workforce, the company will also see the departure of Oliver White, who acted as its CFO until now. White will be succeeded by Tony Nicol, who currently acts as the director of finance and investor relations.

White acted as the CFO for four years, and he will stay with the company until the end of the year, which is when Nicol will take over. Other than that, Jacobs also mentioned several of the latest developments, noting that she is pleased to report that the path set out in March is gaining momentum and that things are moving in the right direction.

For the moment, Funding Circle’s YTD performance remains in line with expectations, with the company being on track to meet full-year guidance.

However, it is no secret that the firm struggled over the years. Its shares are down 80% compared to 2018 when it was first listed in London.