Neo Financial Cuts 10% of Staff Amid Valuation Slide

Neo Financial has eliminated 102 roles, representing approximately 10% of its workforce, as BetaKit first reported. The cuts affected nearly every part of the company, including group product manager for financial crime Sergio Schüler and senior product designer Camilla Herrmann.

In an internal memo and LinkedIn post, Neo co-founder and CEO Andrew Chau stated the company had grown rapidly, allowing complexity to slow down operations. Co-founder and chief commercial officer Jeff Adamson told BetaKit that the company had been "building too many things at once," which spread staff thin. Adamson noted that a streamlined team would allow Neo to focus more energy on credit, savings, daily banking, and homeownership. He clarified that the move was not a reaction to overhiring or AI automation.

The workforce reduction follows a significant decline in the company's valuation. BetaKit reports that Neo was valued at more than $1 billion CAD following its May 2022 Series C deal. However, The Globe and Mail reports that a November 2024 Series D raise—reportedly led by investor Tencent—reduced the company's post-money valuation to $510 million USD. Additionally, Neo saw the end of two major loyalty card partnerships this year with The Hudson’s Bay Company and Tim Hortons.

Neo stated that impacted employees will receive severance, extended benefits, and a waived equity cliff. Federal government records cited by BetaKit show Neo was granted permission to hire 26 temporary foreign workers last year and seven in the first half of this year; Sergio Schüler noted his work visa was employer-specific.