Security News
Kyle Alspach
The company said that the reductions affect about 12 percent of its workforce and were necessary in response to slowing customer growth.
Identity security firm JumpCloud has laid off 100 employees — 12 percent of its workforce — in response to slowing customer demand amid an uncertain economic environment.
In an email to staff, which was posted on the company’s website, JumpCloud co-founder and CEO Rajat Bhargava said the cutbacks have been made “for the health of the business.”
[Related: Microsoft Layoffs Hit Employees In HoloLens, Advertising And Marketing Departments]
JumpCloud’s revenue during the second half of 2022 “grew less than our operating plan forecasted, while our expense base continued to rise,” Bhargava said in the email to staff.
The company’s small-to-medium-sized enterprise customers “aren’t growing as quickly as they were” previously, he said in additional comments posted on the JumpCloud site. “This forces us to change our business and financial model for sustained growth.”
Louisville, Colorado-based JumpCloud is privately held and raised a $225 million Series F funding round during the fall of 2021, bringing the company to more than $400 million in total funding, with a valuation of $2.6 billion.
The company becomes the latest of many in the tech industry, and one of dozens in the cybersecurity sector, to disclose layoffs since economic upheaval began in mid-2022.
Many cybersecurity vendors had become accustomed to rapid growth in recent years, partially in response to a string of high-profile cyberattacks including the ransomware attack on Colonial Pipeline and the software supply chain compromise of SolarWinds.
As a result, many vendors had adopted a strategy of “burning money to capture growing market share” while the good times lasted, said Stel Valavanis, founder and CEO of Chicago-based managed security provider onShore Security.
Now, however, some security vendors are clearly recognizing they need to step back and “make sure they’re spending money on the things that are truly growing,” Valavanis said.
Earlier this week, cybersecurity giant Sophos disclosed that it’s reducing its global workforce by up to 10 percent, citing both the current economic environment as well as plans to invest more heavily into an “as-a-service” model.
