The latest layoffs, involving roughly 17% of the Cybereason workforce, surface roughly four months after Cybereason had layoffs in June 2022 and scrapped a near-term IPO plan that was seeking a $5 billion valuation for the business.
In a statement about the job cuts, Cybereason told Calcalist:
“This is a difficult decision for us and we are doing the utmost in order to help the employees in this process. As market conditions have changed significantly and the technology IPO market is effectively closed, companies like ourselves must be financially strict and prioritize financial efficiency over growth. The demand for our technology remains high and we are continuing to build an independent global company with long-term strategic goals.”
Cybereason Investors: Softbank Under Pressure
Cybereason investors include SoftBank's Vision Fund 2, Google Cloud and Liberty Strategic Capital. Softbank Group, one of the world’s best-known venture capital firms, is facing high-stress times that involve record Softbank financial losses amid continued executive departures.
Many startup valuations have plummeted in recent months as some investors shifted their preference from hyper revenue growth to reliable profit growth. That investor mind-shift has made it extremely difficult for growth-first startups to explore IPO waters.
Rising interest rates and stubbornly high inflation have further pressured startup valuations and M&A deals.
Economic Headwinds Pressure Microsoft Azure, Google Search
The economic headwinds have extended from technology startups to mainstream technology giants. Indeed, earnings reports and weak financial forecasts from Microsoft and Google parent Alphabet further shook investor confidence on October 25, 2022.