Layer 2 blockchain unicorn Polygon Labs on February 1 announced that it has laid off 60 employees, which will be around 19 percent of its employee base, in an attempt make the team nimbler. The company is also spinning off Polygon ID as a separate entity in the coming months.
This comes exactly a year after the company laid off 100 employees or around 20 percent of its workforce in February 2023.
Polygon’s team size is now of around 220 employees after spin offs and headcount reduction. Impacted employees will be offered two months of severance pay and health benefits through the end of February in locations where the company provides health benefits.
The company will also be helping impacted employees on an opt-in basis, wherein they can add details related to their professional background to be shared within Polygon's networks, including recruiters at web3 projects, talent partners at venture capital firms, and hiring managers in the space.
Remaining employees who continue to be a part of the team, will be offered 15 percent hike "effective retroactively to January 1, 2024". Employees who joined very recently will also receive a 5 percent increase, the company said in a blogpost.
Marc Boiron, CEO, Polygon said, “This decision is not an easy one. Right-sizing for the sake of enhanced performance, rather than for financial reasons, may seem unconventional. The reality is that achieving our mission often demands challenging decisions, and while difficult, the Founders and I agree that we must move forward in a thoughtful way that gives us the greatest chance to execute successfully.”
Sandeep Nailwal, co-founder Polygon posted on X, "Saying goodbye to friends and colleagues is always very painful, but this was a necessary step to take Polygon Labs back to its 'underdog' roots. This makes us lighter, nimbler and more mission focused."
"Our relentless focus is to build the Planetary scale blockchain network for the world which I believe the Polygon tech can play an important role by building a network of aggregated blockchains," he added.
Last year, two out of the three initial co-founders of Polygon, Jaynti Kanani and Anurag Arjun, had also quit the startup.
Restructuring business
Meanwhile, after separating 10-member investment arm Polygon Ventures or P2 Ventures last year from Polygon Labs, the company will soon be spinning off a 33-member Polygon ID in the coming months.
In February 2022, Polygon had raised $450 million in a funding round led by Sequoia Capital India (now Peak XV Partners) with participation from more than 40 major venture capital firms.
Tiger Global, SoftBank, Galaxy Digital, Republic Capital, Makers Fund, Steadview Capital, Elevation Capital among others also participated in the round through the token sale.
Back then Polygon had 7,000 decentralised apps being developed on its network and 7-8 product lines. In October 2023, Nailwal shared that the blockchain network grew to have 60,000-70,000 decentralised applications on its network and four major product line segments.
Nailwal also told Moneycontrol, that the startup had a decent runway of funds for the foreseeable future. This includes about a billion dollars in MATIC tokens and $170-200 million from its previous funding round.
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