Partior, a Singaporean blockchain fintech company, is the latest startup backed by state-owned Temasek Holdings to be hit by job cuts and staff exits.
Tech in Asia reported that the startup had reduced its headcount in July, going from over 130 to now 90 staff members. This comes after the termination of around 30 employees and the exit of some from the leadership team.
A large part of this layoff could be attributed to Partior’s investors, who made it clear that their support would only be given “under the condition of a tighter and more focused use of the investment”.
This is a statement included in the termination letter issued to axed employees, which Tech in Asia reportedly reviewed. The layoffs primarily affected employees in Singapore, where the startup is based.
In an interview with Tech in Asia, Partior pointed out that the company’s “cost structure by far exceeds the income generated, which is unsustainable”.
These layoffs, though unfortunate, were “difficult but necessary decisions to best gear the company to realise scale and grow volume,” Partior added in the interview. It’s part of the company’s efforts to move from a startup to “a full-fledged scaleup”.
Is there a bigger issue at hand?
While we have not personally reviewed the termination letter, Tech in Asia shared another piece of information.
In the termination letter, Partior mentioned having encountered “greater challenges than initially anticipated in onboarding banks” and a transition of volumes to their platform that has taken longer than expected.
For context, Partior is an interbank network supporting multi-currency payments. What this means is it enables financial services players (like banks) to access interbank rails for real-time, cross-border, and multi-currency clearing and settlement.
Simply put, it makes cross-border transactions faster with the use of blockchain technology.
Part of the termination letter brought up how Partior faced “unforeseen technical hurdles” while navigating an unspecified new process. Hence, the startup needs time to resolve these issues.
It’s unclear whether these technical hurdles are related to the layoffs and employee exits, but it’s interesting to note that they come not long after the appointment of a new CEO.
Back in January, Partior’s then-CEO Jason Thompson abruptly left the fintech startup and was succeeded by Humphrey Valenbreder in May. Humphrey was previously the COO of Bunq, a neobank based in the Netherlands.
We found that some employees (or ex-employees) of Partior have posted un-raving reviews of the company on Glassdoor. A few of them actually cited the new CEO’s entry as a “con”.
Some feedback they had included:
- “New CEO lacking strong vision and strategy for the company.”
- “The hard-built [company] culture will be gone with the new CEO.”
- “No leadership and lack of management.”
New funds for new growth
Together, this news is rather shocking considering that Partior just raised around US$60 million during its Series B round in mid-July.
Based on its press release, the funds will enable the advancement of new capabilities like intraday FX swaps, cross-currency repos, programmable enterprise liquidity management, and just-in-time multi-bank payments.
“The investment will significantly support Partior’s international network growth and the integration of additional currencies, including AED, AUD, BRL, CAD, CNH, GBP, JPY, MYR, QAR, and SAR, into its network. Partior is currently live with USD, EUR, and SGD,” it said.
The funding round was led by Peak XV Partners (formerly Sequoia Capital India & SEA) and joined by Valor Capital Group and Jump Trading Group.
The Monetary Authority of Singapore (MAS) played a hand in the creation of Partior. It was part of an experiment launched back in 2016 called “Project Ubin” to explore the use of distributed ledger technology.
Dictionary time: Distributed ledger technology is a digital system for recording the transaction of assets in which the transactions and their details are recorded in multiple places at the same time. Unlike traditional databases, distributed ledgers have no central data store or administration functionality.
Tech Target
Considering all of this, it’s not far-fetched to say that a lot is riding on Partior becoming a success. Whether or not the fintech startup rises to meet these expectations is still to be seen.
- Learn more about Partior here.
- Read other articles we’ve written about Singaporean startups here.
Featured Image Credit: Partior