Wefox CEO Julian Teicke.

Wefox

HELSINKI, Finland — The boss of European digital insurance startup Wefox has offered a damning response to a tech company that has laid off workers en masse.

People like Meta, Amazons and Twitter have laid off tens of thousands of employees in response to pressure from investors, who want to see them cut costs to weather the global economic downturn.

Swedish fintech firm Klarna was one of the first big tech firms to cut jobs this year, shedding 10% of its workforce in May. Several companies have followed suit, from Big Tech companies to venture-backed startups like Stripe.

Julian Teicke, CEO of Wefox, told CNBC he is “disgusted” by what he views as the neglect by some of his colleagues towards their employees.

“I’m a little sick of statements like, ‘never miss a good crisis’ [or] ‘we have to cut the fat,'” Teicke said in an interview on the sidelines of Slush, a startup conference in Helsinki, Finland.

Venture capitalists have been advising startups in their portfolios to cut costs and freeze hiring as economists warn of an impending recession.

Following a bumper 2021 filled with IPOs and major funding rounds, some of Europe’s most valuable startups are laying off large numbers of staff and drastically reducing their expansion plans.

At the start of the Slush on Thursday, Sequoia Capital partner Doug Leone told founders and investors that they must embrace the opportunities brought by challenges in the wider economy.

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Foreseeing a protracted recession worse than the 2008 or 2000 crisis, Leone said some companies will emerge stronger than others.

“You have great opportunities ahead of you, if you play your cards right,” he said. “You have a chance to pass 10 cars. Don’t waste a good recession.”

In some eyebrow-raising comments, Sebastian Siemiatkowski, CEO of Klarna, said his company was “lucky” to cut jobs when it happened. Siemiatkowski says that about 90% of people who have been laid off have found new jobs.

“If we did it today, unfortunately it probably wouldn’t happen,” Siemiatkowski told CNBC in an interview.

Without naming names, Teicke criticized the tech industry for its approach to mass redundancies.

“These are people who may have quit other jobs to join your business. These are people who may have moved elsewhere because of you. These are people who may have ended romantic relationships.”

Teicke said managers have a responsibility to protect their employees.

“I believe that CEOs should do everything in their power to protect their employees,” he said. “I’ve never seen it in the tech industry. And I’m sick of it.”

“These are humans,” he added.

Wefox is a Berlin, Germany-based firm that connects users seeking insurance with insurance brokers and partners through an online platform. The company was valued by investors at $4.5 billion in a July funding round.

Wefox says its business is “crisis-proof”. But fellow insurtechs have had to make cuts lately, including Lemonade, which lost 20% of staff at Metromile, an auto insurer it acquired, in July.

Asked whether his own company should make redundancies in response to shifts in investor sentiment, Teicke said his company was “cautious” about the macroeconomic environment but had no plans for mass layoffs.

“I don’t believe in mass layoffs,” Teicke said. “We will focus on performance, but not on mass layoffs.” Wefox is “very close” to achieving profitability next year, he added.

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