S’pore Startup GoBear Lays Off 22 Staff Despite Recent US$17M Funding
Singapore-based fintech start-up GoBear announced yesterday (September 1) that it would lay off 22 employees due to the Covid-19 pandemic.
This represents 11 percent of GoBear’s total workforce, or 200 employees. Affected employees are part of GoBear’s operations, product and technology teams.
Of the 22 employees, six are from the Singapore office, three of which are locals. About 70% of the remaining team in Singapore are locals or permanent residents.
According to GoBear, affected staff received post-employment support.
The downsizing exercise came after a series of cost reduction initiatives in recent months, including shutting down non-core projects and reducing fixed costs and software licenses.
GoBear Remains Resilient Amid Covid-19
According to interviews with GoBear CEO Adrian Chng, GoBear’s main source of income comes from its sale of qualified consumer leads to its partners.
In some cases, revenue is earned through a cost-per-acquisition model where customers only pay after they’ve sold a product.
Despite Covid-19, GoBear’s financial services platform experienced positive gross margin with growth in the insurance and loan verticals.
Its digital insurance brokerage segment has increased average order value by 52% over the past three months.
GoBear’s acquisition of AsiaKredit, a leading digital consumer lender, saw 50% year-on-year revenue growth in lending products.
A significant part of GoBear’s transformation into a full financial services platform was also completed in 2019.
Last year, GoBear raised more than US $ 80 million in funding from Walvis Participaties, a Dutch venture capital fund, and Aegon NV, a leading financial services provider.
Retrenchment necessary for “future-proof” activities
In May 2020, at the height of the pandemic, GoBear also raised another US $ 17 million in funding from Walvis Participaties and Aegon NV to accelerate its transformation.
Since 2015, it has served over 55 million users in seven countries with over 2,000 personal finance products.
GoBear’s goal is to reach the 300 million people in the Asian market who remain underserved by existing financial services through financial literacy and inclusion, Adrian says.
Despite GoBear’s progress, the impact of Covid-19 led it to lead the downsizing exercise.
“This decision was not taken lightly,” says Adrian.
“We had to take steps to adapt our business to meet the challenges and sustain it for what lies ahead, focusing on our growth drivers of digital credit and digital insurance brokerage.
Featured Image Credit: GoBear
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