Luno, a global crypto-currency company, will reduce its workforce by 35%. CEO Marcus Swanepoel of the South African-born Luno wrote to staff members in an internal communication that the business is changing the size of its team across all of its markets to survive the present “crypto winter.”
The Digital Currency Group (DCG)-owned business will lay off 35% of its workforce as a result of the unexpected and extremely bad events that have affected the global crypto market over the past few months, he said.
Following a string of unfavourable incidents, including market unrest, the closure of some significant crypto exchanges, and a lack of regulation that weakened investors’ faith in cryptocurrencies, the price of bitcoin and other cryptocurrencies plunged in 2022.
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“It is with deep regret that I have to announce we will be reducing our overall Luno team by 35%, impacting Lunauts in all of our regions,” said the CEO’s memo. “2022 has been an incredibly tough year for the broader tech industry and in particular the crypto market. Luno, unfortunately, hasn’t been immune to this turbulence, which has affected our overall growth and revenue numbers.
“As a result, we have to readjust our focus to maintaining our leadership position in our core markets, and continue to lay a strong yet sustainable foundation for the business, as we prepare to come out of this current cycle in a very strong position.”
Swanepoel claims that the company’s “unfortunate” choice was caused by the worldwide economic slump, an even greater decline in the ICT sector as a whole, and a series of shocks that collectively had a compounding effect on the industry.
He added that other explanations include the demise of FTX, which was once the fourth-largest cryptocurrency exchange in the world, and the sharp decline in the price of the Luna cryptocurrency over the past few years.
“This, in turn, has impacted us indirectly in a number of ways: on the capital side, a significantly more constrained funding environment, with the market’s focus shifting from long-term investment to shorter term profitability, and on the operating side, a negative impact on market sentiment and consequently on growth and revenue for our business, along with all of our peers and competitors.”
Additionally, Luno disclosed that its co-founder and CTO Timothy Stranex had departed the business after nearly ten years in order to work on personal projects.
The original team of Luno, which includes Swanepoel, Pieter Heyns, and Carel van Wyk and founded the business in 2013, also included Stranex, who left in December. Seven years later, the US-based crypto juggernaut DCG bought it.
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Beginning in January, Luno named Simon Ince, a former vice president of engineering, as its new chief technology officer.
“Coming from a background of leading diverse, multi-disciplinary engineering teams for tech-industry leaders such as at Microsoft, stepping into the CTO role at Luno is a hugely exciting opportunity for me,” comments Ince. “I will lead Luno’s global engineering team as we continue to build a simple, intuitive app that promotes a safe and reliable experience for our 10 million customers across the globe. As Luno explores and innovates with new products to elevate this experience, we will also continue to develop the talent of our engineering team for success.”
Charles Rapulu Udoh
Charles Rapulu Udoh is a Lagos-based lawyer, who has several years of experience working in Africa’s burgeoning tech startup industry. He has closed multi-million dollar deals bordering on venture capital, private equity, intellectual property (trademark, patent or design, etc.), mergers and acquisitions, in countries such as in the Delaware, New York, UK, Singapore, British Virgin Islands, South Africa, Nigeria etc. He’s also a corporate governance and cross-border data privacy and tax expert.
As an award-winning writer and researcher, he is passionate about telling the African startup story, and is one of the continent’s pioneers in this regard