Bench Faces Significant Layoffs Following Troubled Acquisition

Bench, an accounting and tax startup recently acquired in a fire sale last December, has confirmed a series of substantial layoffs, as reported by TechCrunch.

Impact of Layoffs

While the company has not disclosed the exact number of affected employees, insiders indicate that dozens of positions have been eliminated, impacting a significant portion of Bench’s workforce of approximately 300 people.

Departments Affected

Departments including customer success services and tax advisory services have been heavily affected. According to sources familiar with the situation, most of the United States Tax Advisory Team has been let go, raising concerns about Bench’s operational capabilities.

CEO’s Statement

Employer.com, a San Francisco HR tech company that acquired Bench last year, communicated to TechCrunch that the decision to proceed with layoffs was “not made lightly.” CMO Matt Charney expressed gratitude to the employees for their diligent work in maintaining client accounts.

Financial Background and Previous Challenges

Before its recent troubles, Bench had raised over $110 million in capital funding and an additional $50 million in debt under prior ownership, yet it has still failed to achieve profitability. The startup previously burned through significant capital before abruptly closing down, leaving thousands without access to their financial records.

Continued Workforce Structure Issues

Reportedly, many employees are being classified as independent contractors, renewing 30-day contracts monthly instead of offering full-time positions. Although CMO Charney mentioned that recent cuts reflect the need to stabilize the business rather than a shift towards outsourcing, many employees remain concerned about job security.

Client Retention and Future Plans

Bench has faced challenges in retaining clients, particularly after the tax season ended on April 15. Reports from frustrated customers suggest that Bench has been invoicing for services already paid for, although the company insists that all prepaid services are being honored. Moving forward, Charney noted that some customer attrition was an intentional choice aimed at letting go of unprofitable accounts, paving the way for better financial management and future growth.

Conclusion and Future Directions

Looking ahead, Bench aims to refine its offerings and improve workforce stability. Charney stated that the company is exploring longer-term solutions for its team, referred to as “bench comrades,” indicating a commitment to rebuilding its reputation and service quality. For a more detailed exploration of the layoffs, read the complete statement from employer.com here.

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