Fintech
Fintech firm Pagaya is cutting about 20% of its workforce in its second round of layoffs
Fintech firm Pagaya is embarking on a broad retrenchment process, Calcalist has learned. The company will lay off 100 employees, most of them in Israel, and Yariv Hasar, who joined Pagaya to lead its Israeli operations two years ago, will leave. The layoffs will affect all departments and all levels of management. Pagaya currently employs 540 people, including 400 in Israel.
This is Pagaya’s second round of layoffs in a year and a half. In early 2023 it laid off 140 of the 650 employees it employed at the time. Most of those fired (110) were from Israel. As a result, Pagaya management, which is primarily based in the United States, continues to reduce its presence in Israel.
Pagaya, which has developed a loan underwriting engine to enable the provision of credit to a broader audience, operates primarily in the American market. In Israel, its focus is on research and development, with a small credit fund operation that faced a crisis last year after blocking repayments for investors.
The layoffs at Pagaya come just days after a similar move by Israeli company OrCam, which also laid off 100 employees. At this stage it is difficult to determine whether this is a trend, but it is possible that in both cases the move is linked to the war in Israel.
The current cut comes shortly after Pagaya released strong financial reports for the first quarter of 2024, revealing revenues of $245.2 million, a 30% increase over the corresponding quarter. The increase in revenue contributed to an improvement in profitability, but the company still reported a loss of $21.2 million in the quarter. Additionally, the company’s shares, listed in New York at a value of $790 million, were added to the Russell 2000 index. Those close to the company believe that the current cuts are intended to accelerate the transition to profitability and achieve positive cash flow. In recent months, Pagaya management has focused on becoming a product company.
Pagaya was founded in 2016 by Gal Krubiner, who serves as CEO, Avital Pardo, who serves as CTO, and Yahav Yulzari, the company’s CRO. The three founders spend most of their time at the headquarters in the United States, the rest of the management is also American. The current move is led by Sanjiv Das, president of Pagaya, who joined the company last October. The company went public through a merger with a SPAC at a valuation of $8 billion in 2022.