"This move requires the very difficult but necessary decision to say goodbye to many talented people"
Digital home lender Blend has announced a series of “strategic and financial initiatives” that support its transition from a product company to a platform company – and that means cutting its workforce.
The California-based firm said the initiatives aim to right-size Blend’s cost structure, focus its investments on the highest potential growth opportunities, and realign its leadership. Specifically, Blend will slash 28% of its onshore workforce in Blend Title and corporate operations in R&D, sales, marketing, and general and administrative roles.
Blend has laid off 400 employees since April 2022 as it continues to see massive losses due to a shrinking mortgage market marked by rising rates. With the latest workforce reduction and other “savings initiatives,” the company expects to reduce its annualized cost of revenue and operating expenses by over $100 million starting in the second half of 2023.
“Over recent months, we have undertaken ambitious financial and strategic planning to align our cost structure, innovation spend, and go-to-market focus with current market realities and how our customers most want to leverage our platform,” said Blend CEO Nima Ghamsari. “A key step in that effort is the significant reduction in our overall expenses. This move requires the very difficult but necessary decision to say goodbye to many talented people as we align the organization with market realities and prepare for future growth.
“We are also advancing our planned transition from a multiple-point-solution model to a platform business. This journey entails enhancing our go-to-market model around our Blend Builder offering, our composable origination platform that our customers can use to accelerate their digital transformation across product lines in areas like consumer banking and home equity lending. At the same time, we can help our mortgage customers be more efficient in a tough market by focusing on driving adoption of the rich stable of products we have already built, including Loan Officer Toolkit, Self-serve Prequalification, Blend Income, and Blend Close, as our customers seek to strengthen their competitiveness ahead of the next market upturn.”
Ghamsari confirmed they are restructuring their leadership team in alignment with the company’s platform ambitions. Blend has brought on Amir Jafari as head of finance and administration and added Erin Lantz to its board of directors.
The company also announced the departure of president Tim Mayopoulos, who will step down from his management role in the first quarter but remain a board member. Blend head of finance Marc Greenberg, and Crystal Sumner, head of legal, compliance, and risk, will also leave Blend in the coming months. Winnie Ling, who currently leads corporate and securities legal functions, will become head of legal, reporting to Jafari.
“Amir’s strong leadership experience will serve Blend well as we scale,” Ghamsari said. “Amir’s appointment follows the recent addition of Dean Klinger to head Blend’s go-to-market activities; both have been instrumental in executing similar platform transitions in the software industry. I want to express my gratitude to Tim, Marc, and Crystal for their vital, tireless efforts in building Blend. Each expressed a desire to transition their roles, and they are committed to a full transition path, including Tim continuing his board role.”
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