Hippo Insurance Lays Off 70 Employees, Cutting 10% of Workforce
CTech – Israeli-founded insurtech company Hippo has announced that it has laid off 70 employees, which represents approximately 10% of the company’s workforce. The company said it made the decision “to further drive efficiency and increase focus on the strategic priorities.” The layoffs are effective immediately, with the company saying that it “expects the majority of the affected employees to be notified on August 31, with most job eliminations effective on September 1.”
Hippo also announced a change to its executive team, with Ran Harpaz departing from his position as Chief Operating Officer and Chief Technology Officer effective November 15.
Hippo’s shares fell by almost 6% on Wednesday, reducing the company’s market cap to $555 million.
Hippo announced last month that its total revenue for the second quarter of 2022 was $28.7 million, an increase of $7.8 million year-on-year. Meanwhile, gross loss ratio for the quarter was 78%, a substantial improvement from last year’s 161%.
Assaf Wand, founder and Executive Chairman of Hippo Insurance said at Calcalist and Discount Bank’s Unicorn Forum earlier this summer: “Let’s just say I experienced better years than this last year. We were worth $5-6 billion and now we are worth half a billion dollars. There is a major correction. It also happened to Pinterest, DoorDash, and Peloton. It will affect everyone. I have been studying the crisis of 2001 for the last few months. At the end, it is a correction that comes after very low interest rates and things get cleaned out. At the moment it has gone too far to the other side.
“The feeling is not so pleasant but it distills the essence of the company. We learned very quickly that we need to address what is happening and tighten the cash flow. By the way, I am convinced our company is in much better condition than it was when we were worth $6 billion. I think the move to become a public company was good for us.
“Think about the alternative: to be worth $3 billion, but everyone knows it’s not the correct price because one investor on the private side is not like many investors on the public side. I prefer to be valued at $750 million and reach profitability. The crisis will end in 24 months and I have money to survive this. I’d rather receive the blow and deal with it directly.”