A London data analytics startup founded by four ex-Google employees and backed by Goldman Sachs has laid off 34 employees, around 12% of its entire staff, after missing internal growth targets.
Two sources close to Qubit told BI about the cuts, which were confirmed by CEO Graham Cooke on Wednesday.
Cooke told BI: “We implemented a restructure but the way we’re looking at it is we underinvested in certain areas like customer success and partnership and we’ve overinvested in trying to reach growth, in fitting with what the market was demanding last year.”
Qubit made the cuts on Tuesday after missing its first and second quarter growth targets, the two sources said.
Cooke confirmed this to BI: “That is the reality. We set ourselves up for a growth plan that had capacity for 125%. That’s just not a realistic plan in today’s environment.
“If you look at the companies performing best right now with their IPOs, like Twilio, they’re growing more sustainably with growth rates in the 30-50% range, with really good metrics around their customer acquisition costs. Clearly, that is become the model for higher value businesses now.
“The growth at all cost that the markets been subscribing to for the last few years — the costs are so high to acquire customers, it’s just changing so quickly. Active cash management is the name of the game right now. You need to play the long game.”
Cooke said the restructure should help Qubit get to breakeven by the start of next year, quicker than the 18 months timeline it targeted back in February.
Qubit was founded by four ex-Google employees including Cooke, offers big data analytics tools to retailers to help them analyse and optimise their web pages. Its tools track what people look at on pages, why they leave a website, and other metrics.
The startup, founded in 2010, works with brands like Topshop, Thomas Cook, Emirates, and Superdry, according to its website. It has offices in London, New York, Chicago, San Francisco, Paris, and Munich.
Qubit raised $40 million (£30 million) in February from investors including Goldman Sachs, SAP’s venture capital arm Sapphire Ventures, and Accel Ventures. Cooke said Qubit has not yet touched any of this investment cash.
Startups across London have been making layoffs due to a tougher economic environment and a squeeze on funding. Google-backed custom kids book startup Lost My Name let 10% of staff go last month and property crowdfunding platform Property Partner cut 29% of employees around the same time.
Cooke said Qubit is still hiring engineering and product staff, but added: “The hardest thing for me is we did part ways with some really talented individuals. Everyone is a talented person — no one was let go for performance — and I’m personally supporting people to find a new job with our network.”