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Monday, June 24, 2024

Fitness Company WHOOP Slashes Workforce By 15%

  • Company says ‘the current macro environment has created new challenges and uncertainty.’
  • Cuts impacted every department at WHOOP, which was valued at $3.6 billion nearly a year ago.
Design: Alex Brooks

Wearable technology company WHOOP launched a round of layoffs Thursday that led to the elimination of 15% of its workforce. 

The company’s high-tech fitness tracker has been embraced by world-class athletes like LeBron James, Tiger Woods and Michael Phelps, and a partnership with the PGA Tour. WHOOP had a valuation of $3.6 billion after its last funding round was completed nearly a year ago.

“The current macro environment has created new challenges and uncertainty, and we are committed to building a durable business that is able to withstand whatever economic climate we find ourselves in,” WHOOP said in a statement to Front Office Sports. “A reduction like this is never easy and we sought to ground this process in both empathy and compassion.

“The company is deeply appreciative of the contributions from these talented individuals.”

Before the cuts, WHOOP had more than 630 employees.

Multiple WHOOP employees took to social media channels to announce they had been laid off. The company said the cuts “impacted employees across all departments and all levels.”

Ben Foster, WHOOP’s Chief Product Officer, changed his job description to “gainfully unemployed” on LinkedIn.

“While a decision like this is never ‘easy,’ it was definitely ‘right,’ and one I endorsed despite its personal impact,” Foster wrote. “Many growth stage companies who relied on endless streams of venture capital must immediately downshift to manage burn and extend their runway.” 

“The WHOOP brand, product, and business remain incredibly strong, but this is a move that protects it against dangerous market conditions,” he added. “Following this reduction, the company is now in a far stronger position to realize its fullest potential. I hope others also affected will take solace in this inconvenient truth.”

In a company statement, WHOOP stated “all impacted employees were given the opportunity to participate in private, individual meetings over the course of the day.” WHOOP added that the impacted employees were given “a competitive separation package and have reduced barriers for those employees with stock options to become shareholders if they choose.”

And a laid-off copywriter noted: “Sadly, today marks my last day at WHOOP. Layoffs are never easy, but sometimes it’s the push we need even if we may not see it at the time.”

Founded in 2012 by Will Ahmed, a former Harvard University student-athlete, the Boston-based company has raised $404.8 million in funding, according to Crunchbase. Investors include SoftBank, Thursday Ventures, and Animal Capital.

The WHOOP layoffs follow a trend of cuts among companies over fears of a potential recession. Tech, real estate and digital asset firms have been among the hardest hit with cuts. 

Virtual fitness company Tonal, for example, laid off 35% of its workforce earlier this month.

While the cuts are jarring, WHOOP said it is “experiencing record-levels of engagement in our app this year and has more members than ever before.”

“We are as committed as ever to delivering the best membership experience and innovating on the most advanced health monitoring technology,” WHOOP said.

CORRECTION: An earlier version of this story misstated the number of layoffs at Tonal.

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