Bench, the accounting and tax startup that was purchased in a hearth sale final December, has performed a spherical of great layoffs, it confirmed to TechCrunch.
Bench didn’t specify how many individuals had been affected, however one one that works there estimated that Bench was eliminating dozens of positions – that’s a giant chunk of the round 300 individuals who work for the corporate.
Departments like consumer success and tax providers had been instantly impacted, with one particular person instantly accustomed to the matter telling TechCrunch that the majority of Bench’s U.S.-based tax advisory staff was eradicated.
Employer.com, the San Francisco HR tech firm that purchased Bench final yr, advised TechCrunch the choice to make the cuts “was not made flippantly.”
“We deeply admire the contributions of our workers who’ve labored diligently to keep up these accounts,” Employer.com CMO Matt Charney mentioned.
Beneath earlier possession, Bench raised over $110 million in VC funding and over $50 million in debt, however by no means reached profitability. The corporate burned by its money and abruptly shut down, shedding its total employees and leaving hundreds of shoppers with out entry to their books. Employer.com then swooped in, shopping for Bench for $9 million, re-hiring many of the startup’s workforce, and pledging to revive the startup.
The transfer saved Bench from whole collapse.
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However two present Bench staff and a former one advised TechCrunch that Bench has saved most of its workforce on as unbiased contractors, renewing their 30 day contracts each month as a substitute of hiring them as full-time workers. On the time of the sale, Employer.com mentioned this was a short lived measure.
These individuals additionally advised TechCrunch that Bench has mentioned internally {that a} majority of its workforce can be primarily based exterior of North America. Nonetheless, CMO Charney mentioned the latest cuts replicate “the realities of turning across the enterprise and addressing legacy points, moderately than being a part of any strategic outsourcing initiative.”
Charney advised TechCrunch that Bench is continuous to discover longer-term options for workers, which the corporate calls “Benchmates,” however that this construction was probably the most viable choice to get individuals onboarded shortly post-close.
Past structuring its workforce, Bench has confronted different challenges, the present and former Benchmates advised TechCrunch. For instance, numerous Bench prospects churned after tax season ended on April 15, they mentioned. Bench additionally wasn’t capable of end many shoppers’ taxes on time, one particular person instantly accustomed to the matter advised TechCrunch.
Some annoyed prospects additionally alleged that Bench charged individuals for providers they already paid for underneath prior possession. (Bench advised TechCrunch on the time that it honors all pre-paid providers.)
Charney advised TechCrunch that whereas some prospects have left, this was partly an intentional transfer to let go of unprofitable prospects.
“Whereas we’ve seen an uptick in buyer churn, a good portion of it has been intentional and crucial,” Charney mentioned. “Over time, legacy pricing and servicing choices made earlier than our acquisition of Bench led to a subset of shoppers being supported at a loss.”
Charney added that going ahead, Bench has plans to develop each options and headcount.
For extra, learn Employer.com’s full statement on the Bench layoffs here.
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