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Logisitics startup Flexport is hitting some rough seas.
The company is reportedly planning to cut almost 20% of its staff, or about 500 people, as it looks to navigate a downturn in the global shipping industry and return the business to profitability.
This development comes on the heels of a $260 million investment from e-commerce giant Shopify, structured as a convertible note.
“We’ve been profitable in the past. We’re working on a plan to get back to profitability toward the end of next year, Q4 2024,” Flexport CEO Ryan Petersen said last year.
Flashback: Flexport's 2023 was a bumpy ride:
- January: They cut 20% of their staff.
- September: The CEO quit after just a year.
- October: They announced a 70% drop in revenues for the first half of the year.
- October (again!): Another 20% of the team got the boot, including several key executives.
And 2024? Well, it's not exactly smooth sailing so far!
Big picture: Flexport plays the role of a middleman, snagging space on containerships and making a profit on the price difference between what they pay and what they charge customers. But with freight rates taking a dive post-pandemic, Flexport is feeling the pinch.
