Zach Perret's message to Plaid employees
December 07, 2022
Today, I’m announcing the most difficult change we have had to make at Plaid to date. I made the hard decision to reduce the size of our team, and in doing so, to say goodbye to approximately 260 talented Plaids. Our people are the driving force of Plaid, and the caliber of our team and the connection we have with each other makes this decision all the more difficult.
In the next few minutes, all US-based Plaids will receive an email informing them if they have been impacted or not-impacted by this change. If you have been impacted, you will also receive a calendar invitation shortly for a conversation later today to discuss the change, your separation package, and to answer any questions you may have. For Plaids in the UK and Europe, you will receive an email outlining how the process will work in accordance with your local employment laws.
I’m sure you all have lots of questions – so I’d like to explain how we came to this decision, and what happens next.
How we got here
During COVID we saw a dramatic increase in fintech adoption, at a pace that was well beyond what we predicted. We saw a rapid increase in usage by our existing customers, a large number of new customers signing up for Plaid, and substantial revenue acceleration. As all our metrics continued to grow, we hired aggressively to meet the customer demand we were seeing, and to invest in new products.
Macroeconomic conditions have changed substantially this year. Despite being well-diversified across every category of financial services, we are seeing customers across the industry experiencing slower-than-expected growth. The simple reality is that due to these macroeconomic changes, our pace of cost growth outstripped our pace of revenue growth. I made the decision to hire and invest ahead of revenue growth, and the current economic slowdown has meant that this revenue growth did not materialize as quickly as expected.
Today’s changes were incredibly tough, but they were also necessary. They will allow us to continue to operate from a position of strength so we can best support our customers and the millions of consumers we jointly serve for the long-term.
Support for Departing Plaids
The realities of the world around us do not make this decision any easier. Today, we will be parting ways with many talented teammates who have made huge contributions to Plaid over the years. If you are among those impacted, I am truly sorry. I thank you for your contributions, your dedication, and your spirit. I am grateful to have worked alongside you, and am proud to have called you a colleague.
It is very important to us that those of you who are departing are well taken care of, and that we support you in your next career move. This means that all of you who are departing will be offered:
Separation Pay. We will offer 16 weeks of base bay for all departing employees plus additional weeks for those who have been with Plaid for more than one year.
Health Insurance. We will be paying the cash equivalent of 6 months of healthcare premiums for Medical, Dental, and Vision insurance coverage for employees and their dependents.
Equity. We will accelerate equity grants for Plaids who have been here more than one year to the February 15, 2023 vesting date. We will waive the one year cliff for Plaids with equity who haven't yet reached their one-year vesting cliff.
Career Support. We will provide 6 months of career support and coaching services to actively assist everyone in their search for employment opportunities.
Mental Health. We will provide 6 months of continued coverage through Modern Health for all departing employees.
Immigration. For those on a work visa, we have dedicated immigration counsel that you will have access to for consultation and support.
UK and Europe. For those of you who are in the UK or Europe, our support will be similar and in line with laws there.
We have removed access to many systems for those of you that are leaving. I understand that this might make the process seem more abrupt, but I hope you will understand given the sensitive nature of data in our industry. We will be keeping email open through the end of the day so that you can say goodbye and share contact information, if that is something you choose to do.
There is no great way to manage a process such as this, but our goal is to treat each of you with respect, support, and care. We want to support you as best we can to find your next place to make a difference in the world.
The Path Ahead
Today is a difficult day, and I want to ensure we all take some time to process these changes. Tomorrow, we will come together for an All Hands where we will provide additional details and answer questions you may have. I do, however, want to take a moment to acknowledge what this means for our overall outlook.
The underlying fundamentals that drive digital finance (and therefore Plaid) are not changing. People continue to need tools and services to manage their financial lives, and the financial industry will continue to move towards digital-first delivery. We deliver crucial infrastructure that our customers rely on day-to-day, and we continue to sign up new customers at a rapid rate. The number of customers we serve has grown ~50% over the past year, including many of our largest new customers joining last quarter. Our mission to unlock financial freedom for everyone is likewise critical – as more and more people turn to fintech to help them save money and manage their budgets in difficult economic times.
Importantly, I am optimistic for our road ahead. The changes that we are making today are designed to align the size of our organization to match our strategic priorities, and those of our customers. We continue to operate from a position of strength, with a strong balance sheet and excellent business fundamentals. As we look to the future, we must lean into the ambition, urgency, and grit that helped us build the company we are today as we continue to lead our industry forward.