SINGAPORE – Temasek-backed cashback and rewards platform ShopBack has reduced its employee headcount by 24 per cent or 195 roles “to become more focused and self-sustainable as a company”. The shock announcement was made by co-founder and chief executive Henry Chan at the company’s town hall on March 19. Those laid off notified were within an hour of the event’s conclusion in markets where this is possible, according to a message by Mr Chan posted on the ShopBack website. The company also called off the rest of the workday. All departures were kept to the same day “out of respect and to ease transition for departing team members”, with their last in-office day as March 19, 2024. “Undoubtedly, this is one of the hardest decisions I’ve had to make in our company’s history,” said Mr Chan in his message titled On Focus And Sustainability – A Painful Decision. “I made the mistake of pursuing too many directions as a company and expanding our team too rapidly. I take full responsibility for the decisions that have led to this situation,” he said. Laid-off employees were offered pay for at least two months of their notice period, and an additional month of severance payment for every full year of service or based on local statutory guidelines – whichever is higher, said Mr Chan in the message. They will also receive a bonus equivalent to a month’s salary, which will be pro-rated for those who have yet to complete a full year of service, on top of encashment of leave days which have been accrued and unutilised. All outgoing employees will have their medical insurance coverage extended; access to mental healthcare support will run until June 30. These employees will also receive career transition support, which includes either curriculum vitae reviews or a “career transition support allowance” determined in consultation with the human resources department. Visa holders will have their repatriation costs covered, including airfare and a budget for moving expenses – to “ensure a seamless transition back home if that is the option (they) are pursuing”, said Mr Chan. In his note, the chief executive disclosed that ShopBack approached its headcount reductions by “redesigning from scratch a reorganised and lean organisational structure” that would enable it to deliver on its strategy for sustainable growth. Every existing role within the organisation was reviewed, starting from “the most senior levels”, he said, to determine the extent to which these roles aligned to ShopBack’s future needs. “Ultimately, I decided on a more substantial reduction to minimise the chances of us ever having to do this again.” In his memo, Mr Chan emphasised that each proposed reduction was “deliberated, and many times hotly debated” between him and ShopBack’s leaders. “Many of you will be feeling distressed, fearful, or angry right now – and you have every right to feel this way… In many cases, your leaders advocated to keep you and the final decision to part ways was made by me. They are not at fault, and I urge each of you not to place any blame on them.” ShopBack’s layoffs come a month after the company reported a 20 per cent decline in its revenue to US$87.7 million (S$118 million) for the financial year ended March 2023. Voucher revenue fell by more than half. The company’s losses before tax also widened by 29 per cent year on year, as one-off employee and merger and acquisition expenses affected growth. Earlier in March, the company announced it would be discontinuing its “buy now, pay later” service, PayLater, from March 22 following a periodic review of its business units. THE BUSINESS TIMES