Fintech unicorn Fundbox has laid off 40% of its workforce in Israel and the U.S., parting ways with 150 of its 360 employees.
Fundbox, which had developed an AI-powered financial platform for small businesses, raised a $100 million Series D funding round at a valuation of $1.1 billion last November. The company raised a $200 million Series D at a $700 million valuation the previous year.
Its investors include the Healthcare of Ontario Pension Plan (HOOPP), Allianz X, Khosla Ventures, The Private Shares Fund, Arbor Waypoint Select Fund, and a suite of BNY Mellon funds managed by Newton Investment Management North America.
Founded in 2012 by Eyal Shinar, who served as its CEO until 2020, Yuval Ariav, and Tomer Michaeli, Fundbox offers credit solutions to small and medium-sized businesses. Since Shinar switched to the role of chairman, the CEO position has been filled by Prashant Fuloria.
The layoffs come as Fundbox is struggling to find profitability, and follow the recent departures of CEO Eyal Shinar and President Prashant Fuloria. Fundbox has raised over $470 million in venture capital funding to date, but it is unclear how long the company can continue to burn through cash without becoming profitable.
In a statement, Fundbox said that it is “refocusing its business to drive long-term, sustainable growth.” The company did not say how it plans to achieve this goal, or how the layoffs will impact its business.
Fundbox’s troubles are a sign of trouble for the fintech industry, which has been struggling to live up to its lofty promises in recent years. Many fintech startups have been forced to pivot to new business models, and some have been acquired by larger companies. Fundbox’s layoffs are a sign that even well-funded fintech startups are not immune to the challenges of the industry.