Open banking FinTech startup Bud is reportedly laying off up to one-fifth of its staff just months after announcing a $20 million fundraise, The Telegraph reported on Monday (Sept. 16).
According to the publication, Bud is developing software that enables traditional banks to integrate directly with other financial services firms. It is part of a growing population of open banking startups looking to develop solutions around new regulations in Europe and the U.K. that promote bank-FinTech integration and cooperation.
Bud first launched in 2016 as a consumer-facing FinTech, offering users a mobile app that provides an overview of all of their accounts across financial service providers while bundling products like current accounts and investments. In February, Bud announced its $20 million fundraise from HSBC, Goldman Sachs, Banco Sabadell, ANZ and Investec.
Despite that investment, Bud has reportedly confirmed plans to lay off 20 percent of its staff, with CEO Ed Maslaveckas pointing to the company’s shifting business strategy and the need to hire “a different group of people.” He added that Bud is focusing on hiring more engineers.
One unnamed source told the publication that the laid-off employees were part of Bud’s marketing department. Before the layoffs, the company reportedly had about 100 staff members.
“Part of being an agile tech business is that you can respond quickly to changes in the market,” Maslaveckas added. “We’re adapting our strategy to focus 100 percent on delivering value to business customers, and that means we need a different group of people to deliver it. For example, the strategy also means we’re hiring more in our sales and development teams.”
Earlier this week, Plaid, another FinTech that uses API technology to integrate with users’ various bank accounts, announced strategic funding from Visa and Mastercard.