Irreplaceable, Australia’s largest crypto gaming startup known for its NFT trading card game Gods Unchained, has announced that it will be laying off 11% of its total workforce, despite having announced its termination mid-last year.
According to The Sydney Morning Herald, Immutable made the announcement to employees on Wednesday morning. The company previously raised $280 million from investors in a funding round that valued the crypto gaming company at $3.5 billion in March last year.
It seems that the company’s June layoffs of 20 employees, or about 6% of its personnel, is not enough to prevent financial difficulties and the need to preserve cash flow after the fall of the cryptocurrency market.
Crypto Gaming Firm Imotable: More Cutbacks
The company announced the termination internally, citing the need to save cash reserves and focus on important goals as the reason.
James Ferguson, co-founder and chief executive officer, confirmed the cuts in a note, citing the need to maximize the duration of the company’s cash reserves and allocate resources to the most critical projects.
Image: Immutable
Ferguson wrote:
“I take full ownership of the action […] this is difficult news, and I apologize to all Immutables affected by these changes.
The job cuts can be better understood by looking at the company’s financial information for the previous fiscal year, filed with the Australian Securities and Investments Commission.
Immutable earned $27 million, but had $83 million in expenses, including about $45 million in personnel, consultants, and freelancers. These figures, submitted to meet legal requirements, may not give an accurate picture of the company.
Organizational Structure Changes
Reportedly, the affected employees will know if they have been fired by email. Those who will lose their jobs will receive an average of 10 weeks of redundancy pay, computers, counselling, and outplacement assistance. Health care will be provided for US staff.
In an effort to recover financial losses, the company also changed its organizational structure.
These changes include a proposal to outsource the creation of video games to alternative partners, allowing Immutable to concentrate on developing its competencies in Web3 and cryptocurrency technologies. According to the Herald, spending will be redirected to new key sectors.
Crypto total market cap at $1 trillion on the daily chart | Chart: TradingView.com
Folding Company
Immutable is the latest Australian startup to lay off employees in the past year, following the likes of express grocery delivery service Milkrun and social media tool Linktree, as investors become hesitant to place big commitments in young companies.
As the cryptocurrency sector has lost more than a trillion dollars in value since 2022 and as rising interest rates increase fears of an economic downturn, this redundancy in the web3 industry is not unusual.
Last year, many crypto companies folded, resulting in several high-profile bankruptcies and even ongoing court battles.
-Featured image from GamesHub