Nansen, a blockchain analytics platform, has announced a significant restructuring plan, which includes reducing its staff by 30%. The company's Chief Executive Officer (CEO), Alex Svanevik, revealed the news in a memo shared via social media, expressing regret at the necessity of these changes.
Nansen to Reduce Its Workforce by 30%
The rationale behind Nansen's decision, as explained by the CEO, is twofold. First, the company aggressively scaled its team during its early years to capitalize on rapid growth and market opportunities. This expansion resulted in the company branching out into areas that strayed from its core strategy. The CEO took full responsibility for this, assuring stakeholders that the restructured organization would refocus on its key competencies, aiming to do fewer things but with increased efficiency and excellence.
The second contributing factor to the downsizing has been a challenging year for the crypto markets, a sector in which Nansen operates. While the firm has managed to diversify its revenue streams by attracting enterprise and institutional customers, the cost base remained high compared to the company's current standing. The CEO was quick to assure that Nansen still had several years of runway but stressed the need to build a sustainable business.
"A reduction of 30% of our team is significant. But we believe we need to make organizational changes to create the right conditions for those who stay with us. It may not seem like it today, but we are still committed to building the best workplace in crypto," Svanevik commented.
This week we announced the extremely difficult decision to reduce the size of the Nansen team.
— Alex Svanevik 🐧 (@ASvanevik) May 30, 2023
I’m endlessly grateful to the incredible people we are parting ways with. They will go on to achieve great things, and we'll ensure they get a soft landing, with severance and support.
Estimating that Nansen employs around 200 people, a one-third workforce reduction will likely mean that approximately 60-70 individuals will bid farewell to the team.
According to Svanevik, the objective is to focus on core operations, enabling a leaner Nansen team to concentrate on developing products for its customers.
The CEO's memo ended optimistically, underscoring Nansen's commitment to building the best workplace in the crypto space, despite the current challenges. Svanevik emphasized the company's ongoing dedication to transparency and called for patience and compassion as they navigate these difficult times.
"We'll face challenges along the way, but we're here to help build a new financial fabric for the world," Nansen's CEO concluded.
Widespread Cuts in Blockchain Industry
Although the workforce reduction in Nansen might seem deep, it is not definitely a lone case. During 2022 and at the beginning of 2023 many crypto and digital assets companies announced similar moves to fight the 'crypto winter', a long-term period of lower prices and yields.
Four months ago, Luno, the digital assets exchange based in London, announced a massive workforce reduction. Luno decided to lay off 35% of its current staff, translating to more than 300 professionals in all regions of its operations.
A few days earlier, Gemini, the cryptocurrency platform owned by the Winklevoss twin brothers, made an announcement about a 10% reduction in employment. It was the third job cut in the last 12 months. Meanwhile, ConsenSys, a cryptocurrency software company, has confirmed its plans to cut 11% of its current workforce, which translated to almost 100 positions.
At the beginning of 2023, Coinbase announced one of the biggest reduction plans for 950 positions (20% of its workforce). A cessation of the operations in Japan was another part of the current headcount reduction and cost-effective cuts.
