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Mortgage tech and title insurance provider Blend Labs Inc. announced Tuesday that it’s laying off more than a quarter of its remaining workforce and will part ways with some top executives as part of ongoing efforts to stem more than $1 billion in cumulative losses.
The fourth round of layoffs at Blend in less than a year will affect about 340 employees — or approximately 28 percent of the company’s U.S. workforce — reducing Blend’s payroll expenses by about $43 million a year, the company disclosed in a regulatory filing.
Blend also announced the resignations of President Timothy Mayopoulos, Head of Finance Marc Greenberg, and Head of Legal Crystal Summer. While Mayopoulous will continue to serve on Blend’s board of directors, Greenberg and Summer will depart the company during the first quarter.
Amir Jafari
Amir Jafari, who’s served as chief financial officer for Reputation.com and fintech Plastiq Inq., has been named Blend’s head of finance and administration. In that role, Jafari will oversee finance, people operations, legal, compliance, IT and information security. Winnie Ling, who currently heads Blend’s corporate and securities legal functions, will become head of legal, reporting to Jafari.
Nima Ghamsari
“Over recent months we have undertaken ambitious financial and strategic planning to align our cost structure, innovation spend and go-to-market focus with both current market realities and how our customers most want to leverage our platform,” Blend co-founder and head Nima Ghamsari said in a statement.
“This move requires the very difficult but necessary decision to say goodbye to many talented people as we align the organization for market realities and prepare for future growth,” said.
Blend reported a $132.7 million third quarter net loss in November, with revenue falling 38 percent year over year to $55.3 million. Blend has posted a loss every quarter since the company was founded in 2012, with an accumulated deficit of $1.082 billion as of Sept. 30.
Blend announced layoffs affecting about 100 employees, or 6.4 percent of Blend’s workforce, in November. The company had previously cut 200 positions in April and another 220 in August, including the elimination of 80 vacant positions.
All told, Blend said those layoffs and other cost cutting measures it’s implemented are expected to produce annualized savings of more than $100 million by the end of 2023.
The company said the latest round of layoffs will impact Blend Title and corporate operations in research and development, sales and marketing and general and administrative functions.
Blend’s national title insurance and settlement services business, Title365, drove much the company’s third quarter loss. While Title365 revenue was down 65 percent from a year ago, to $19.3 million, Blend also took a $57.9 million third quarter charge as it wrote off its investment in the company.
Blend now says that this year, it will focus its investments “on the highest potential growth opportunities, and realign its leadership to drive the company’s transition from a product company to a platform company.”
A bigger portion of operating expenses will be funneled into Blend Builder, a configurable subscription-based software platform that also collects “success based” transaction fees from clients.
“This platform is already the foundation of Blend’s non-mortgage offerings, and over time will give mortgage lenders the flexibility and power they need to differentiate from their competitors,” the company said.
Blend said it will also help lenders “be even more efficient by implementing the large backlog of features built over the past several years, including Loan Officer Toolkit, Self-serve Prequalification, Blend Income, and Blend Close.”
Erin Lantz
Blend also announced that it’s appointed fintech executive Erin Lantz to its board of directors. Lantz, who has served as chief revenue officer of Ethos, a fintech company specializing in life insurance, is filling a vacancy left by Roger Ferguson, who resigned on Jan. 9 “to focus more time on his various other board and business commitments.”
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