Digital Bank Neon Announces Mass Layoffs of Over 200 Employees

Digital Bank Neon Lays Off More Than 200 Professionals in Technology, Products and Other Sectors, Following Other Institutions Like Nubank and C6 Bank.

After Nubank and C6 Bank, it is now the turn of Digital Bank Neon to implement mass layoffs. The bank has joined the list of financial institutions that have reduced their workforce amid the challenging environment for startups. The mass layoff took place on Wednesday (15) and affected 9% of the total workforce, according to disclosed data.

Mass Layoff at Digital Bank Affects Technology, Products and Much More

Thus, at least 210 professionals were laid off from Digital Bank Neon based on the number of employees reported by the company on its LinkedIn page. However, the institution did not disclose the official number of layoffs.

According to affected former employees, the mass layoff occurred mainly in the technology, agile projects, and product sectors, across all levels of seniority, including professionals with less than one year at the company.

The Fintech Neon, founded in 2016, became a unicorn, a term used for startups valued at over US$ 1 billion, in February of last year, following a Series D funding round of US$ 300 million by the Spanish bank BBVA.

In a statement sent to the press, Neon stated that “the reduction in the workforce was a necessary adjustment to face macroeconomic challenges and that the layoffs were based on performance evaluation cycles.”

Based on recurring performance evaluation cycles and the deprioritization of certain activities, the mass layoff was difficult but essential to preserve the operational efficiency of the company to maintain business sustainability without overburdening the end customer.

Neon remains confident in its team and reiterates its commitment to creating simpler and fairer financial paths for Brazilian workers.”

C6 Bank Lays Off About 500 Employees

C6 Bank confirmed on February 6 the layoffs at the company, but did not disclose the number of affected professionals. However, according to the portal Layoffs Brasil, which tracks layoffs in startups and financial institutions, the cut affected about 500 employees, primarily in the technology, products, and human resources sectors.

The company states that the reduction in its workforce is part of a normal operational shift due to a change in investment focus; that is, the digital bank aims to enhance user experience operations rather than product development.

C6 Bank claims it will continue hiring, with no freeze on job openings, and also emphasizes that it still has 400 job openings available, ending this year with 800 hires.

Nubank Ends Advisory Team

Nubank, one of the largest financial platforms in the world, serving over 70 million customers in Brazil, Mexico, and Colombia, decided to terminate its investment advisory team, which was developed in 2022.

The closure of the team reportedly led to the layoff of 40 professionals; however, the digital bank did not reveal specific information. The layoffs occurred just weeks after an investment product from Nubank was criticized by several customers.

This concerns the Nu Immediate Reserve Fund, a fixed income option marketed as an emergency reserve for those with less than R$ 1 to invest, but which suffered significant losses due to holding debt securities from Americanas in its portfolio.

The decision to disband the investment advisory team, however, had no connection to the criticisms regarding the Nu Immediate Reserve, as the fund was available to all customers of the digital bank.