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Earlier today, Swyftx co-Founder and CEO Alex Harper sent the following note to all our team members after addressing colleagues at a townhall.
Today we’ve announced the hardest decision Angus and I have had to make in our careers. We’re saying goodbye to 90 talented friends and colleagues.
As we’ve just announced to the team, Swyftx has no direct exposure to FTX, but we are not immune to the fallout it has caused in the crypto markets. As a result, we have to prepare in advance for a worst-case scenario of further significant drops in global trade volumes during H1 next year and the potential for more black swan-type events.
Our business is uniquely well-positioned to weather events like FTX. We provide a customer experience that is unrivalled in cryptocurrency and we are by a distance, the country’s most trusted exchange. But as much as we might wish it, we do not exist in isolation from the market and that’s why we are acting fast and acting early by significantly reducing the size of our team. We do this with a sadness that is very difficult to put into words. Suffice to say, we will do everything in our power to support impacted colleagues.
We know not everyone in the team will understand the sudden need for this, especially given November’s increase in trade volumes and this week’s unqualified financial audit, but our priority at this time is to emerge from the current market in a position of strength. As discussed at today’s all-hands meeting, to accomplish that we need to manage our operating costs to ensure our continued financial strength and to keep the confidence and trust of our customers.
As a business, we acknowledge that we are looking at costs through a lens of extreme caution, but I’m afraid we cannot take risks. We have the largest team of any fully owned and operated Australian exchange, with up to five times more team members than most of our main domestic competitors. We are simply far larger than we need to be to operate and grow next year and beyond. We were genuinely hopeful in August that the revenue modelling we’d done would not require any further reduction in staff numbers, but the FTX situation has forced us to plan for a period of diminished trading activity. In this, we are not alone, with many exchanges now in the process of scaling down their teams.
The truth is that Swyftx grew too fast. Our world was very different at the start of the year and our forecasts were for global trading volumes to carry on rising for at least six months longer than they did. The fact we are now making our costs more consistent with industry standards is, in no way at all, a reflection on our team members. But we understand how difficult this news will be for impacted team members and their families, especially at this time of the year.
There is no good way to let go of team members. But we are doing what we can to treat everyone as respectfully as possible. As detailed at our townhall, everyone, including Swyftxers whose jobs aren’t impacted, will get an email about their role.
Those impacted will today receive an invite to their personal email for an individual consultation tomorrow. Ensuring equal treatment, every single person we say goodbye to this week will receive their severance pay within 7 days after, receive ESOP for tenure plus 6 months, and have job search support and EAP services available.
Finally, I know some of you have asked about our plans to raise funds. I do need to say that we’d be taking this action irrespective of any potential growth equity raise. Every tech business in the world right now is scrutinising their costs and Swyftx is no different. Investors expect discipline and our new normal will be to aggressively explore options for efficiencies and cost reductions, regardless of market conditions.
To those friends and colleagues who do leave us, myself and Angus want to pass on our deepest thanks for your support and dedication.
To those staying, I want to reiterate the point that we are in a position of strength. As a business that puts customers at the centre of everything we do, I know many of us are nursing a very strong sense of injustice about the actions of FTX and its impact on our industry, its customers and now our own team. Cryptocurrency wasn’t the villain in this story, it was all too familiar human greed and indifference. Nonetheless, I’m afraid only time and Swyftx continually demonstrating it is different, each and every day, will put FTX behind us.
In the meantime, it’s important to remember that we remain Australia’s top-rated exchange and one of its largest, with more than 630K customers. A position of trust that has never been more important. I would also remind you that even as we manage our cost base down, we will retain one of the two largest cryptocurrency teams in the ANZ region. A position that does allow us to continue to provide the industry’s highest standards of compliance, security and customer experience in 2023 and beyond.
– Alex Harper